Overseas activity & partner standards

§ 01ACNC External Conduct Standards

As an ACNC-registered charity that operates outside Australia, Hearts of Hope Foundation is required to comply with the four ACNC External Conduct Standards (ECS):

• ECS 1 Activities and control of resources (including funds). The Foundation takes reasonable steps to ensure its activities and the funds it sends overseas are used in a manner consistent with its charitable purposes and ACNC governance standards.
• ECS 2 Annual review of overseas activities and record keeping. The Foundation keeps records of overseas activities, partner relationships, and the use of resources, and reviews those records at least annually.
• ECS 3 Anti-fraud and anti-corruption. The Foundation takes reasonable steps to minimise the risk of fraud, corruption, bribery, and money laundering in its overseas activities, including by its partners.
• ECS 4 Protection of vulnerable individuals.The Foundation takes reasonable steps to ensure the safety of children and other vulnerable individuals affected by its overseas activities. The Foundation's Child Safeguarding Policy applies to all overseas partners under cascading contractual obligations.

§ 02Partner identification & due diligence

Before any funds are transferred to an in-country partner, the partner must complete the Foundation's due-diligence process. The process is documented and recorded for ECS 2 purposes; records are retained for at least seven years.

• Verification of legal identity, registration, and good standing in the partner's home jurisdiction;
• Verification of office bearers and the controlling minds of the partner organisation against PEP and adverse-media databases;
• Review of the partner's financial controls, anti-fraud policy, and most recent audited financial statements (where available);
• Review of the partner's child safeguarding policy and complaint mechanism, with cascading contractual obligations under ECS 4;
• A signed, written Memorandum of Understanding (MoU) covering scope, budget, reporting cadence, audit rights, child safeguarding obligations, anti-fraud obligations, sanctions undertakings, termination triggers, and data-protection;
• A pre-transfer sanctions screening (see § 03), recorded with screening date, screening provider, and result.

Initiatives are not promoted from Proposed or Scoping to Active until the above is complete and the MoU is in force.

§ 03Sanctions & legal screening

The Foundation does not operate in any jurisdiction without first screening the proposed partner, its controlling minds, and (so far as practicable) its delivery partners against the relevant sanctions lists administered under Australian law. The applicable instruments are:

• The Autonomous Sanctions Act 2011 (Cth) and the Autonomous Sanctions Regulations 2011 (Cth), as administered by the Department of Foreign Affairs and Trade (DFAT);
• The Charter of the United Nations Act 1945 (Cth) and the Charter of the United Nations (Sanctions) Regulations made under it, which give effect in Australian law to United Nations Security Council sanctions resolutions, including UNSC Resolution 1267 (Al-Qaida / ISIL / Taliban sanctions);
• The Criminal Code Act 1995 (Cth), in particular Division 102 (terrorist organisations) and Division 103 (financing of terrorism), which create offences for making property available to a listed terrorist organisation, including indirectly.

The operative tool is the DFAT Consolidated List, which combines all persons and entities currently subject to autonomous and UN sanctions in Australian law. Every partner is screened against the DFAT Consolidated List before any transfer and re-screened at least annually thereafter. Where the Foundation operates in a jurisdiction subject to UNSC 1267 sanctions (e.g. Afghanistan), additional screening against the UN Security Council 1267 list is performed and documented separately.

The Foundation is not itself a “reporting entity” for the purposes of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF Act). The banks and remitters used by the Foundation are reporting entities and conduct their own AML/CTF screening on outbound transfers; the Foundation cooperates fully with any information requests from those reporting entities and from AUSTRAC.

Where a screening result is inconclusive or yields a positive match, the transfer does not proceed. The matter is escalated to the board of Hearts of Hope Foundation for documented review, and where appropriate to DFAT and to legal counsel. The partner relationship may be terminated.

§ 04Afghanistan-specific compliance

Activity in Afghanistan attracts an enhanced compliance regime because of the overlapping Charter of the United Nations Act 1945 (Cth) UNSC 1267 measures relating to the Taliban and Al-Qaida, the autonomous sanctions framework, and the Division 102 / 103 offence regime under the Criminal Code. The Foundation applies the following additional steps to all Afghanistan activities:

• Screening of the proposed partner and its controlling minds against the UN 1267 list and the DFAT Consolidated List before contract execution; results recorded with date and provider.
• A documented assessment, signed off by the board, that the proposed activity does not make property (directly or indirectly) available to a listed terrorist organisation for the purposes of Criminal Code Division 102, including via taxes, levies, fees, or other diversions to Taliban-controlled organs.
• A funds-transfer protocol that documents the chain from the Foundation's Australian bank account to the in-country distribution point, including any intermediary banks, exchange providers, or hawala equivalents, with sanctions and reporting-entity status confirmed at every step.
• Where the planned activity could be characterised as making assets available to a designated person, a permit application under the Autonomous Sanctions Regulations 2011 (Cth) (reg. 18) is prepared and submitted to DFAT before the activity proceeds. The relevant permit number, where obtained, is recorded against the partner file.
• Annual re-screening and re-assessment, documented in the Foundation's ECS 2 records.

The Foundation does not solicit or accept restricted donations earmarked for Afghanistan from donors who decline these compliance steps; any restricted Afghanistan donations from such donors will be returned.

§ 05Anti-fraud & corruption controls

The Foundation operates a zero-tolerance position on fraud, bribery, and corruption. Anti-fraud and anti-corruption obligations are cascaded to in-country partners by contract under each MoU, and partners are required to maintain their own written anti-fraud policy.

• Segregation of duties between authorisation, payment, and reconciliation of overseas transfers;
• Two-signatory authorisation for any single overseas transfer above a threshold set by the board;
• Independent verification of receipt by the in-country partner against an evidence-of-delivery protocol (photos, receipts, partner sign-offs) without exploitative imagery of children;
• Contract clauses giving the Foundation the right to suspend, terminate, and seek recovery in the event of suspected fraud or corruption;
• Reporting of any substantiated overseas fraud, corruption, or sanctions breach to the ACNC and to law enforcement as required by Australian law.

§ 06Monitoring, reporting & per-country partner record

For each overseas initiative the Foundation publishes the in-country delivery partner's identity, jurisdiction, MoU effective date, and reporting cadence. The records are reviewed at least annually under ECS 2. Initiatives shown as scoping or proposed are not recipients of any transfers; restricted donations directed to those initiatives are held in reserve as described in our Donation Terms § 07 (Allocation of funds restricted vs unrestricted).

§ 07Incident reporting & whistleblowing

Any person including donors, partner staff, beneficiaries, and members of the public may raise concerns about an overseas activity, including suspected fraud, sanctions breach, child safety incident, or partner misconduct. Concerns may be raised in confidence to admin@heartsofhope.org.au or under our Whistleblower Policy. External avenues the ACNC public register and law-enforcement bodies remain available at all times.