Money laundering or foreign contribution! The spirit of governance in NGOs of India
| DOI | https://doi.org/10.1108/JMLC-05-2021-0050 |
| Published date | 03 August 2021 |
| Date | 03 August 2021 |
| Pages | 481-487 |
| Subject Matter | Accounting & finance,Financial risk/company failure,Financial compliance/regulation,Financial crime |
| Author | Sandeep Goel |
Money laundering or foreign
contribution! The spirit of
governance in NGOs of India
Sandeep Goel
Department of Accounting and Finance, Management Development Institute,
Gurgaon, India
Abstract
Purpose –The present paper aims to discuss the “money laundering”aspectand related governance practices
of third sector, non-government organizations (NGOs). In NGOs globally, foreign contributions are not an old
story. But in NGOs, the spotlight on the vulnerability of moneylaundering in the name of foreign contribution(s)
requires special attention. The study highlights the dimension of money laundering in an Indian NGO and
related dominance of board leadershipabout governance issues by way of foreign contribution.
Design/methodology/approach –The present study uses case study method for enlightening the
money laundering tussle in a non-government organization and its governance impact on the stakeholders’
interestsat large.
Findings –The results stress upon the need for to have strong anti-money laundering practices in non-
government organizations in the form of foreign contributions which are still struggling to have a sound
governancesystem in place.
Practical implications –It is of significance to both policymakers and standards setters at the
international level in the light of increasing globalawareness about anti-money laundering practices of the
third sector.
Social implications –There will be an improvement in the corporate management related to money-
laundering of these organizationsand infuse higher confidence among stakeholders and further lead to their
effectiveregulatory framework.
Originality/value –It is an original paper whichhighlights the role and significance of money laundering
practicesin the third sector.
Keywords Non-government organizations (NGOs), Money laundering, Foreign contribution,
Governance, Board
Paper type Conceptual paper
1. Introduction
The third sector, non-governmental organizations (NGOs), assumes higher significance on
accountof increasing awareness aboutits “money laundering”aspectand related governance
practices during past few yearsacross the globe. There cannotbe any foreign contribution(s)
if not allowedby the regulation of the native countryand so in India. It has to be permitted by
“Foreign Contribution (Regulation)Act (FCRA), 2010.”On accountof its increasing relevance
about theirforeign contributions(s)across the globe, there had been bundleof concerns; about
ethics, valuesand most importantly moneylaundering factor of NGOs.
Elizabeth Kallman et al. (2016) stresses upon the fact that “The third sector plays a
critical role in creating values worldwide, through its work in service delivery, advocacy,
The author is thankful to Rahul Pramani, Research Scholar, Management Development Institute
Gurgaon, India for his valuable inputs in the study.
Spirit of
governance in
NGOs
481
Journalof Money Laundering
Control
Vol.25 No. 2, 2022
pp. 481-487
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-05-2021-0050
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