CAN YOU ATTEND IFTAR ORGANISED BY CONVENTIONAL BANKS?

The last ten days of Ramadhan have started well in Tanzania with such fantastic Qur'an Competitions attracting local and international Qur'anic reciters and memorizers. On the other hand, this is another time whereby families, neighbours invite friends and others for Iftaar. Such culture has for some time now gone far and penetrated the corporate corridors of conventional banks and other companies which has for every Ramadhan prepared and organised Iftaar for their customers and people of their own choice followed with media fancy to appeal to achieve their desired goals.

INVITATION FROM SOMEONE WHOSE INCOME IS UNLAWFUL (HARAM).

Sheikh Muhammad ib Adam of Darul Iftaa, United Kingdom states that " If a person, whose income is unlawful (haram), invites one for food or gives something as a gift, then if more than half of his wealth is lawful (halal) and less than half unlawful (haram), it would be permissible to eat at his house or accept a gift from him, even without investigating if the food or gift was acquired from lawful wealth or otherwise.

However, if most of his wealth is certainly Haram, for example: this unlawful job (insurance broker) is his sole means of income, then in such a case, there are two possibilities:

If he clearly stipulates that the food provided or the gift was acquired through Halal wealth, one may eat at his house or accept the gift. However, if this is not the case, it would not be permitted to eat at his house or accept his gift in the Hanafi School. One will have to investigate and ascertain this before eating at his house.

It is stated in al-Fatawa al-Hindiyya:“If a taker of interest or the one who earns unlawful wealth was to give one a gift or invite one to his house for food, it will not be permitted to accept his gift or eat at his house if most of what he earns is unlawful, unless he informs one that it was acquired through lawful wealth which he gained through inheritance or by taking a loan. And if most of his earnings are Halal, there is nothing wrong in accepting his gift or eating at his house.” (al-Fatawa al-Hindiyya, 5/343)

The harms and ill-effects of consuming Haram food are quite severe indeed. In a Hadith the Messenger of Allah (Allah bless him & give him peace) said: “A body nourished on Haram sustenance (rizq) will not enter paradise.” (Sunan Tirmidhi)

In a narration, the Messenger of Allah (Allah bless him & give him eternal peace) described the consumption of Haram food as the main cause for the non-acceptance of supplications (dua).

He (Allah bless him & give him peace) mentioned a man having journeyed far, is dishevelled and dusty and who spreads out his hands to the sky (saying): O Lord! O Lord! - While his food is Haram, his drink is Haram, his clothing is Haram, and his nourishment is Haram, so how can his dua be answered! (Sahih Muslim)

The Messenger of Allah (Allah bless him & give him peace) said to the Companion Sa’d:

O Sa’d! Purify your food, your supplication will be accepted. By the one in whose hand lays the life of Muhammad, verily a servant places a morsel of Haram in his stomach (and as a result) forty days of worship will not be accepted from him.” (Recorded by Imam Tabrani)

In another narration, it is narrated that an angel at Bayt al-Maqdis proclaims every day and night: “Whosoever consumes unlawful (haram) food, Allah Most High will not accept his obligatory (fard) and voluntary worship.” (See: al-Kaba’ir of Imam Dhahabi).

WHAT ABOUT THE INVITATION FROM THE CONVENTIONAL BANK?

We know that conventional banks have two streams of income sources;one is interest ( funded income) and other is fees and charges for the services which are offered (non-funded income). If you like conventional banks have permissible income and non-permissible income. An example of permissible income is the spread from spot foreign exchange sale and purchase, account operation fees such as ledger fees, withdrawal fees, ATM fees, and Cheque book fees; fees and commissions on fund transfer services such as TT fees, TISS charges, Western Union commission, Custom's Tax Collection commission among others.

Does these non-funded income exceed half of total income of the bank? Bank differs with each other in terms of income compositions. However, i dont think this question is relevant, the relevant question is; does the combined non-funded and permissible income above meet the cost of the iftaar organised? This is hard to answer in this discussion but the organiser's must be in position to know and so are shrewd customers who can figure out the costs of the iftaar in a particular hotel or restaurant and the income made by the bank.

Unfortunately, to most of the invitee what is in front of them is the appetite to enjoy the food with total disregards to examine source of income of the respective bank versus the cost of the Iftaar to be on the table. Therefore, if you havenot done well on your homework on this aspect, i will discourage you to attend the iftaar because the wise counsel of the prophet peace be upon him reads that "Leave what you doubt, for what you don't doubt."

Psychopaths on Wall Street.

By:Ronald Schouten, MD, JD |

Psychopaths are the subject of endless fascination. We tend to apply that term loosely to people who engage in bad acts, ranging from pathological lying and repeated deception to major fraud and serial killing. Psychopaths rival pedophiles in the panoply of those we despise and fear. Given this fascination with psychopathy, and the public's current negative view of Wall Street (see Greg Smith's op-ed column in The New York Times about his resignation from Goldman Sachs), it is no surprise that Twitter, the blogosphere, and traditional media have been buzzing about "The Financial Psychopath Next Door," an article in CFA Magazine by Sherree DeCovny (subscription required).

The headline-grabbing factoid in the article was an estimate that 10% of people in the financial services industry are psychopaths. And that's a conservative estimate, according to Christopher Bayer, a Wall Street psychotherapist cited by DeCovny.

DeCovny describes "financial psychopaths" as individuals who seek thrills, lack empathy, don't care about what others think, are charming and intelligent, and are skilled at lying and manipulation. Citing Richard Peterson, managing partner of MarketPsych (a firm that provides psychological and behavioral finance training for the industry), DeCovny notes that these are some of the traits that also predict success on Wall Street.

To understand the implications of all this, it helps to define psychopathy. It is a psychological condition based on well-established diagnostic criteria. These include glibness and superficial charm, conning and manipulative behavior, lack of remorse and empathy, refusal to take responsibility for one's behavior, and others.

Determining whether a person is a psychopath is generally done using a test like the Psychopathy Checklist-Revised (PCL-R), developed by Robert Hare and his colleagues. People who are "normal" invariably score a few points on such scales. True psychopaths score in the top 25%.

Using formal diagnostic criteria, researchers have estimated that about 1% of Americans — about 3 million people — are psychopaths. Based on statistics alone, there are some true psychopaths on Wall Street, as there are in all walks of life. The odds increase further when we consider the competitive advantage that some of the characteristics of psychopathy, including willingness to take risks, can provide in the field.

Psychopathy is mistakenly regarded as an all or nothing affair: you either are a psychopath or you aren't. If that were the case, saying that 10% of people on Wall Street are psychopaths could actually be somewhat comforting, since it implies that the remaining 90% are not and so shouldn't cause us any concern.

That yes-or-no approach dangerously ignores the fact that psychopathic behavior exists on a continuum. A great deal of damage can be done by individuals who fall in between folks who are "normal" and true psychopaths. These are individuals who would never be diagnosed as a psychopath, but whose behavior to varying degrees can be just as deceptive, dangerous, and remorseless as that of a full-blown psychopath. These individuals are sub-clinical psychopaths, what my colleague James Silver and I refer to as "almost psychopaths" in our upcoming book, Almost a Psychopath.

Two things should be noted about the claimed estimate that 10% of people in the financial services industry are psychopaths. First, it is just that — an estimate — and not based on a scientific study. Second, it is likely an overestimate of true psychopaths in the industry, but an underestimate of those who fall into the "almost" category. Formal studies indicate that as much as 15% of the general population can be characterized as almost psychopaths. And if we consider that the financial services industry may select for people with characteristics of psychopathy, it is fair to say that the number of people in the industry who fall into the "almost" range is at least that high. As such, individuals predisposed to fraud, deceit, manipulation, and insider trading may be far more numerous than the 10% estimate that has attracted so much attention.

But there is good news. First of all, it is possible to screen out almost and full-blown psychopaths during the hiring process and after. Some of the key indicators are:
•Glibness and superficial charm
•Lack of empathy
•Consistent decisions in their self interest, even where it is ethically questionable
•Chronic, sometimes transparent lies, even with regard to minor things
•Lack of remorse
•Failure to take responsibility for their actions, and instead blaming others
•Shallow emotions
•Ignoring responsibilities
•Persistent focus on gratifying their own needs at the expense of others
•Conning and manipulative behavior

The only way to deal with a true psychopath is to get him or her out of the organization as fast as possible. While full-blown psychopaths are not deterred by fear and do not learn from punishment, "almost psychopaths" can get the message that adverse consequences will follow misconduct. As a result, strictly enforced firm policies can be effective in deterring those who may be tempted to engage in illicit conduct. As long as the firm wants to deter them.

CASH WAQF DEPOSIT: AN INNOVATIVE PRODUCT FOR ISLAMIC BANKS.

INTRODUCTION.

There has been several calls from Sharia scholars, Islamic economists and researchers among others for Islamic banks to innovate new financial products that caters for social needs of the society rather than mimicking those of conventional finance. Habib Ahmed on his book "Product Development in Islamic Banks" quotes Dr. Mohammed Obaidullah saying, 'The so-called mainstream Islamic Banking and finance is a sham, targeted at high net-worth individuals and corporations against true Islamic ideals and spirits, a poor attempt to disguise conventional products in Islamic garb.'

According to Habib, other than Islamic economists and scholars, many other stakeholders of the industry expect the Islamic financial sector to play social role by developing products that are 'Sharia-based product' which fulfils both Sharia and social requirements. It is in my opinion that Cash Waqaf Deposit Account or certificate is an innovative product that meet such requirements.

WHAT IS CASH WAQF?.

There is considerable discussions and researches on the subject of Cash Waqf to date and so is the meaning and definitions. Taking note of various definitions that may exist, i hereby provide three definitions.
1. According to Dr. Ahsence Lahsasna Cash Waqf "is mobilization funds from donors base on perpetuity and investing them in productive assets that provide either usufruct or revenues for future consumption by individuals or groups by taking into account the policy and guideline provided by the donors and receivers."
2. According to Majid Khademolhoseini, Cash Waqf "means the dedication of some money from one's possessions and establishing a Waqf based on that amount and offering it to the benefit of people generally or allocating it to make use of them by some segments of the community particularly." Majid quote Abdel Mohsin definition as "the devotion of an amount of money by a founder and the dedication of its usufruct in perpetuity to the prescript purposes."
3. According to Muhammad Ridhwan Ab. Aziz, "Cash Waqf are charitable endowments established with cash capital. What distinguishes these from the standard real estate endowments is the nature of their capital, corpus, which is in the form of cash. The corpus of the real estate waqfs, by contrast, is in the form of real estate. Thus, whereas a well to do Muslim normally endows his real estate and channels its rent revenue for charity, in the case of a cashwaqf, not real estate but cash is endowed and the revenue generated out of the investment of this cash is then channelled for charity(Murat Cizakca, 2004)."

PERMISSIBILITY OF CASH WAQF.

According to Haslindar Ibrahim et al,"There is no direct injunction in the Quran about waqf. However, there is a hadith reported by Ibn Umar, whereby Umer Ibn Al Khitab acquired land in Khyber and went to Prophet Muhammad, Peace Be Upon Him (PBUH), and sought advice regarding the land. The Prophet (PBUH) advised that the land should be made inalienable and the profit given to
charity. Therefore, waqf is perceived as a permanent dedication by a Muslim of any property for a good faith purpose that is recognized as being pious or charitable." The indirect injuctionS can be cited on Qur'an Chapter3 verse 92 and 2:177. Chapter 3:93 states "by no means shall you attain righteousness unless you give what you love and whatever you give, Allah know it all." Prophet salallahu alayhi wasallam reported to have said;"When a man dies, his acts comes to an end except three things;recurring charity, knowledge by which people benefit and pious offspring who prays for him." Majority of jurists understood recurring charity serves as the basis of Waqf.

In regards to Cash Waqf, Abu Daud and Nasa’i said that:“A man said to Prophet Muhammad salallahu alayhi wasallam, I have a dinar money. Thus the Prophet PBUH said you donate (waqf) your dinar money to yourself”. This hadith is taken as an evidence of Cash Waqf. At this point it is crucial to note in full what Haslindar Ibrahim et al has to say on Cash Waqf ruling;" The Islamic schools of thought, consisting of Imam Shafie, Hanafi, Hambali and Maliki, jointly agreed to allow waqf for moveable property (Abdullah, 2010). This is because all moveable property can be sold, which can receive benefit in return as well as retain its physical condition. As a result, cash waqf is permissible. Furthermore, pious Az Zuhri, who is well known for his Islamic knowledge, ruled that waqf in the form of dinar (money) is allowed for the sake of Islamic purposes, the welfare of society and development of the ummah (people). In Malaysia, the Malaysian Islamic National Council Ruling (Majlis Kebangsaan Hal Ehwal Agama Islam Malaysia), which having a meeting from 10 to 12 April 2007, at Kuala Terengganu, agreed to allow the practice of cash waqf."

CASH WAQF DEPOSIT ACCOUNT OR CERTIFICATE.

Cash Waqf Deposit is one of the product (sometimes referred as model) developed using Waqf contract. Cash Waqaf as a bank deposit product was firstly introduced by Social Investment Bank now called Social Islami Bank in Bangladesh through the issuance of Cash Waqf Certificate. According to Dr. Mannan, the purpose of this product was to provide the public with an opportunity to mobilise social capital for social investment and welfare. The value proposition of the product is clearly stated by Social Islami Bank (SIBL) as "By opening a Cash Waqf Deposit A/C some one can get an opportunity to do welfare to the mankind through Sadaka-e-Jariah (recurring charity). SIBL urges to all religious & affluent persons of the society to come forward to mobilize Cash Waqf Deposit so that the profit may be utilized for the well being of mankind."

Another bank by the name of Islamic Bank Bangladesh (IBBL) also offers this product with detailed information on its website. Explaining the aim of the product,"It provides a unique opportunity for making investment in different religious, educational and social services. Savings made from earnings for the purpose of Waqf by the well-off and the rich people of the society can be mobilized throughthis scheme and the income to be generated therefrom may be spent for different benevolentpurposes. Through the scheme we may contribute to popularize the role of Waqf in the country including Cash Waqf which can be instrumental in transferring savings of the rich to the members of the public in financing various religious, educational and social services in Bangladesh."

Currently, the product is widely available in Bangladesh offered by SIB,IBBL, EXIM BANK, BANKASIA, Shahjalal Islami Bank, Al-Arafah Islami Bank, Prime Bank among others and in Malaysia it is offered by Bank Islam. According to Majid Khademolhosein, the procedure is as follows:
• The founder deposits money into Cash-Waqf based account in the bank (not allowed to withdraw in order to meet Sharia requirement of Waqf-being perpetual)
• While depositing the money, the founder will be given a list of the Beneficiaries whereby he can chose or specify his/her Beneficiaries.
• The bank will act as a Mutawalli and will invest the capital through Mudharabah Contract.
• The revenue generated will be channeled to charitable purposes or purposes specified by the founder.

CONCLUSION.

It is clear that Cash Waqf deposit product is a fantastic and innovative product with great potential in mobilizing social capital for social investment, poverty alleviations and welfare. Since it was launched in Bangladesh, the product has recorded remarkable growth overtime and send positive signals if adopted in other countries. Therefore, Islamic Banks around the world should have Cash Waqf deposit product that enables them to fullfill social goals in an economical way rather than depend on shareheolders money alone to fulfill bank's social responsibility.