The Treasury Department’s “Voluntary Best Practices for U.S. Based Charities,” are poorly designed for their stated purpose of helping prevent diversion of funds to terrorists. Several speakers made that assessment at a recent Philanthropy and Security forum, hosted by Georgetown University’s Center for Democracy and the Third Sector , which focused on the merits of the Treasury Department guidelines. Attorney David Aufhauser, General Counsel for the Treasury Department when the Office of Foreign Assets Control (OFAC) released the guidelines in November 2002, explained the background of events and concerns that lead to drafting the guidelines. Although he recognized a possible chill on international charities as a result of the guidelines, he said they are needed to address the use of charities as vehicles for training and recruiting terrorists. Aufhauser said overwhelming evidence pointed to nongovernmental organizations (NGOs) being used for such purposes. However, he noted that only three charities have been shut down under powers granted through Executive Orders, and the guidelines have never been cited as authority. Jean AbiNader, Executive Director of the National Association of Arab Americans (NAAA), and an expert on international trade and economic development, said the guidelines are not informed by experience, and are more than voluntary, since the executive branch has vastly broadened its powers. The result has been a climate of intimidation and uneven impact. He also noted that the guidelines are being put into grant agreements for federal contracts with the U.S. Agency for International Development. The contracts require NGOs to certify that no funds will be diverted to terrorists, but the lack of NGO infrastructure and a deficit in regulatory oversight stands in the way of any real achievement. The information that United States agencies seek for compliance with OFAC guidelines is practically impossible to obtain. OMB Watch has called for withdrawal of the guidelines because “they do not reduce the risk of diversion of charitable assets to terrorists, are inconsistent with federal and state laws and place charities in a governmental role of collecting information and assessing potential for terrorist activities.” The Office of Foreign Assets Control has become part of a new agency in Treasury, the Office of Terrorism and Financial Intelligence. This agency also includes the former Executive Office of Terrorist Financing and Financial Crimes and the Financial Crimes Enforcement Network.