PETALING JAYA: What exactly is a charity? That is a question that needs to be asked in Malaysia as there is no single statute or definition of what a charity is.
“Charitable organisations are governed by different statutes and laws. There is no proper monitoring and charities are governed by civil law or syariah laws,” says NGO Childline Foundation executive director Datin Wong Poai Hong, who has worked with charities for decades.
“Under syariah laws, it is quite clear and definite as to what constitutes a charity. Under civil law, there are a number of laws that cover the matter.
“Most non-profit NGOs are registered under the Registrar of Societies while charitable foundations are registered under the Companies Commission of Malaysia (CCM). If you collect donations and cheat, then it comes under the Penal Code.
“Then, there is the House to House and Street Collections Act 1947, and the Islamic Religious Councils, which govern all Muslim donations as well.
“Registered charity organisations have to submit annual accounts, but how often do the public check on these accounts?
“For those under CCM, there is a report for audited accounts. Other than that, no agency looks at the financial accountability or the way charities are run,” said Wong.
She said an independent charities commission could ensure that charities are legitimate and run correctly.
“In the United Kingdom, the commission is a non-ministerial government department accountable to the Home Secretary.”
Ahmad Fahmi Mohd Samsudin, who leads Malaysian Muslim NGOs in many humanitarian charities, said that in forming a charity regulator, the most crucial stage is to get the state religious authorities to buy into the idea. He pointed out that most NGOs are small religious organisations that work within the states.
“State religious authorities have different laws in every state. They must agree to a national charity commission as they too are looking to ensure that there is no abuse of trust,” said Ahmad Fahmi, who is also Global Peace Malaysia CEO.
“The charity commission must not focus solely on Muslim NGOs but ensure that corporate philanthropists, research centres and NGOs of all races, religions and clusters are on the same page,” he added.
Meanwhile, the Malaysian Anti-Corruption Commission (MACC) said it does not have to wait for a public complaint to commence investigations into any abuse of funds.
“When public funds are involved, there is no need for a complainant to come forward. We can commence investigations from a whistleblower’s information or verified information from other sources,” said MACC chief commissioner Tan Sri Azam Baki.
Pointing to the case of Aman Palestin, whose leaders have been charged with various offences for misuse of public donations, Azam said the MACC had to freeze its accounts to investigate.
If the funds collected from the public are found to have been abused or misappropriated, it is a violation under the Penal Code for cheating or criminal breach of trust, he said.
“We will also look into good governance and proper management of publicly donated funds and provide recommendations to the organisation to prevent any room for corruption,” said Azam.
