Saturday, January 12, 2008

Leaders of Islamic Charity Convicted of Fraud for False Exemption Application

The New York Times reports that three leaders of a defunct Islamic charity were convicted on Friday of defrauding the federal government.  The government alleged that Massachusetts-based Care International, which is not related to the worldwide organization of the same name, supported militant fighters in Afghanistan, Bosnia and Chechnya while representing to the IRS that they were helping war orphans, widows and refugees in Muslim nations.  Care International apparently made its misrepresentations when it filed its application for recognition of exemption under Internal Revenue Code section 501(c)(3).  The IRS granted the application, and Care International eventually raised $1.7 million in tax deductible charitable contributions from 1993 to 2001.  The defendants face up to five years in prison and a $250,000, with sentencing scheduled for April.  Their attorneys have stated they will appeal the verdict.  No terrorist financing chargers were brought against the charity or its leaders.  Additional articles about the conviction are available from the Boston Globe and the Washington Post.

LHM

http://lawprofessors.typepad.com/nonprofit/2008/01/leaders-of-isla.html

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