The Union Home Ministry suspects that many non-government organisations registered under the Foreign Contribution Regulation Act (FCRA) are indulging in money laundering. Enforcement agencies have so far initiated investigation against 20 such NGOs.
“These NGOs, particularly those involved in protests against the Kudankulam nuclear power project in Tamil Nadu, received funds from abroad and allegedly diverted the donations for purposes other than their mandate,” an MHA official said.
Based on prima facie evidence of money laundering, the MHA has referred the cases to the Central Bureau of Investigation and the State police.
“The cases involving foreign funds beyond Rs.1 crore have been handed over to the CBI, whereas the NGOs which received funds below Rs.1 crore are being probed by the State police,” the official said.
Only on paper
According to government records, there are about three million NGOs registered across the country. It is suspected that a bulk of them exist only on paper. A total of 45,000 organisations are registered under the FCRA after proper physical verification of their offices and bank accounts.
“The FCRA-registered organisations are classified into three broad categories: NGOs indulging in activities prejudicial to national interest and security; those routinely found violating FCRA norms and attracting commensurate action, including suspension or cancellation of FCRA registration; and those indulging in money laundering,” the official said
Action against donors
In the past few months, the MHA’s focus has been on taking action against the foreign donors which, according to the government, have been encouraging anti-development campaigns, impeding the country’s economic growth.
“There are about 3,000 foreign donors, and action has been taken against only 16 [by putting them on the MHA pre-approval list] for funding campaigns prejudicial to national security,” the official said.
Registration cancelled
Government statistics reveal that as many as 45,000 NGOs receive foreign funding under the FCRA, for which they have to comply with a set of conditions, including the filing of annual returns on foreign donations. Last October, the MHA issued show-cause notices to 10,343 NGOs for not furnishing annual returns, giving them an opportunity to respond within 30 days.
“As there was no response from 8,975 NGOs, including the 510 from where the notices returned undelivered and 632 which did not respond within the stipulated time period, their FCRA registration were cancelled,” the official said.
