In the context of the Russian aggression against Ukraine and the growing global challenges related to anti-money laundering, combating financing of terrorism and proliferation of weapons of mass destruction (money laundering, financing of terrorism and financing of proliferation of weapons of mass destruction (ML/FT/FPWMD), the non-profit organization (NPO) sector in Ukraine has been facing unprecedented risks and challenges. This study presents a comprehensive risk assessment of the NPO sector in Ukraine for combating ML/FT/FPWMD, considering both international standards, in particular FATF Recommendation 8, and the Ukrainian context of the full-scale war.

The purpose of the study is to analyze in its entirety risks and mitigation factors in the NPO sector, covering different categories of organizations, their donors and stakeholders. The study consists of six interrelated parts, presenting vulnerability, threat and risk assessment by NPO category, NPO risk self-assessment, stakeholder and donor surveys, and analysis of risk mitigation factors.

The study was conducted based on the Methodology for risk assessment of the non-profit sector in Ukraine in the field of money laundering, terrorism financing, financing of proliferation of weapons of mass destruction. This methodology was developed by the CEDEM team with international experts involved.

The methodology of the research offers a combination of quantitative and qualitative instruments, such as surveys, interviews, focus groups and content analysis of open data, registers and information for 2018-2023 provided by governmental authorities. Such an approach allowed for the rating threat the NPO sector in Ukraine is exposed to, and its vulnerability, identifying trends in ML/FT/FPWMD-related investigations and charges against the NPOs and their representatives.

An important study component is the analysis of ML/FT/FPWMD risk mitigation factors for various NPO categories that include both government initiatives and measures taken by the organizations themselves. This comprehensive approach enables one to gain a holistic view of the NPO sector risk protection status in Ukraine and to propose effective strategies for risk mitigation. 

The vulnerability assessment by NPO category (Part 1 of the study) was conducted by the Ilko Kucheriv Democratic Initiatives Foundation using the CEDEM methodology developed as part of the Project Ukraine Civil Society Sectoral Support Activity.

Between September 2023 and August 2024, the CEDEM team experts carried out the threat assessment by NPO category (Part 2 of the study), the risk assessment by NPO category (Part 3 of the study), the survey of NPOs on their self-assessment of ML/FT/FPWMD risks (Part 4 of the study), in-depth interviews with NPO donors and stakeholders on ML/FT/FPWMD risks (Part 5 of the study), and analyzed risk mitigation factors for NPOs (Part 6 of the study).

The Report on Independent Risk Assessment of Non-Profit Organization Sector in Ukraine is available at this link.

The research is made possible by the generous support of the American people through the United States Agency for International Development (USAID) within the Ukraine Civil Society Sectoral Support Activity implemented by ISAR Ednannia in partnership with the Ukrainian Center of Independent Political Research (UCIPR) and Centre for Democracy and Rule of Law (CEDEM). The contents are the responsibility of CEDEM and do not necessarily reflect the views of USAID or the United States Government.