Cases of Riba-Based Transactions #1

Cases of Riba-Based Transactions #1

Questions:

1. The bank offered to freeze part of his account in return for interest. My husband has a current account in a foreign bank. His account is very active due to his work. Therefore the bank offered to freeze a part of his account in return for 40.000 Dirham monthly. Is this considered Riba (interest)? My husband does not believe that it is Riba. He believes that Riba – from his viewpoint- is exploiting people’s difficult circumstances (be it sickness or need) by overburdening them by Riba. He says: “the bank is not in need of my money”. What is the ruling in this case? If this is Riba then how shall I convince him of refusing it? Please bear in mind that he is an Alawi Muslim. He does not trust scholars’ opinions and he says that the Quran prohibited interested but not in such cases as his case. He also says that most of the fatawa given by scholars are personal and unconvincing.

2. His job is making sure that the company’s files are recorded properly, including files dealing with riba-based loans. I work for a manufacturing company and part of my job is to make sure that the company’s files are recorded properly. If there is any shortcoming, I write a report which makes it binding on them to correct it. That includes financial files that have to do with the financing of the company’s projects by means of riba-based loans, and taking interest from the sales profits deposited in the bank. What is the ruling on working for this company? What is the ruling on my work? Please note that I may be able to avoid going to the finance department.

3. Some companies put the buyer in a pyramid scheme without him wanting that. We found out from your site that with regard to companies that deal with pyramid schemes, it is permissible to deal with them, buying and selling and so on, so long as one avoids what is haraam, which is entering into these haraam pyramid schemes. But it has become apparent that some of them put the member under the supervisor, even if he did not register as a member under a supervisor in the beginning, and thus they bring him into the pyramid scheme sometime after he subscribes without him realising. What is the ruling on continuing one’s subscription in this case?.

4. Ruling on subscribing to the workers’ retirement fund. The wages of 8.67 days x 3% are deducted from my basic salary each month for the workers’ retirement fund. When I attended the Annual General Meeting to discuss the budget of this fund, I found out that the money collected is distributed among a number of banks and the fund benefits from depositing money in banks at an interest rate of 12.5%. We do not benefit from this money at all throughout our years of service except at the end of our service, when we can get 127 months of our last basic salary. Is the money that we get at the end of our service halaal or haraam? Please note that if we withdraw from the fund, that monthly amount is still deducted. What is the solution?.

  

5. Benefitting from the wealth of a father who deals in riba. I am a young Muslim man and praise be to Allaah my father has some money. He heard a fatwa of Shaykh Tantaawi saying that it is permissible to take bank interest, and he put his money in the bank and started to take the interest. I am convinced that this interest is haraam, and I have tried a lot to convince him to give up this notion, but without success.
Is there any sin on me, my brothers and my mother? I asked my father to promise not to spend on us from the money that comes from the interest. What do we have to do? If this money is spent on us, what should we do? Allaah has blessed me with work in Saudi and my father paid my travel costs, and I do not know whether this money is from the interest or not. Is the money I get from this work haraam or not? I hope you can advise me.

Answer:

1. Praise be to Allaah.

Firstly: 

Before we give advice to your husband with regard to riba, we think that it is essential for us to offer him advice on something that is more important, which is the ‘Alawi madhhab. The ‘Alawi madhhab has many beliefs that are contrary to the beliefs of the Muslims. Hence we hope that your husband will examine those beliefs and reject those that are contrary to Islam, and believe that which is indicated by the Book of Allaah and the Sunnah of His Messenger (blessings and peace of Allaah be upon him).  

Secondly: 

Freezing the bank account in return for getting 40,000 dirhams is the essence of riba because in fact, this transaction is a loan with interest. It makes no difference whether the bank is in need or not. Every loan that brings benefit is riba according to scholarly consensus. What a loan means is taking the money and paying it back; if there is an agreement that it will be returned with something extra, even if it is one dirham, this is undoubtedly riba. 

There is nothing in the Qur’aan or Sunnah to suggest that riba is only that which is taken from the needy, sick or desperate. Rather there are many types of riba, including loans with interest. There is also the riba of sales, such as exchanging gold for gold with an additional amount, or silver for silver with an additional amount, or date or dates with an additional amount. The Prophet (blessings and peace of Allaah be upon him) said: “There are seventy-two types of riba, the least of which is equivalent to a man committing incest with his mother.” Narrated by al-Tabaraani in al-Awsat; classed as saheeh by al-Albaani in Saheeh al-Jaami’, no. 3537. 

And the Prophet (blessings and peace to Allaah be upon him) said: “A dirham of riba that a man consumed knowingly is worse before Allaah then thirty-six acts of zina.” Narrated by Ahmad and al-Tabaraani; classed as saheeh by al-Albaani in Saheeh al-Jaami, no. 3375. This stern warning shakes the heart of every believing man and woman and prevents him or her from falling into this grave sin. Allaah has threatened the one who consumes riba with war, as He says (interpretation of the meaning): 

“O you who believe! Fear Allaah and give up what remains (due to you) from Ribaa (from now onward) if you are (really) believers. . And if you do not do it, then take a notice of war from Allaah and His Messenger but if you repent, you shall have your capital sums. Deal not unjustly (by asking more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums)” [QS al-Baqarah 2:278-279]

Who would want that for himself, who is able for that?! 

Allaah tells us that riba erases blessing and leads to bad consequences. He says (interpretation of the meaning): “Allaah will destroy Riba and will give increase for Sadaqaat (deeds of charity, alms). And Allaah likes not the disbelievers, sinners. [QS al-Baqarah 2:276]

The Prophet (blessings and peace of Allaah the upon him) told us that curses descend upon the one who consumes riba, the one who pays it, the two who witness it and the one who writes it down. Muslim (1598) narrated that Jaabir (may Allaah be pleased with him) said: The Messenger of Allaah (peace and blessings of Allaah be upon him) cursed the one who consumes riba and the one who pays it, the one who writes it down and the two who witness it, and he said: they are all the same. 

What is the value of money if Allaah does not bless it and if curses descend upon its owner?! 

Hence we see many of those who consume riba losing their wealth without benefitting from it because there is no blessing in it, as well as the feelings of worry, distress and anxiety that they feel. This is one of the effects of sin, and the punishment of the Hereafter is more severe and longer lasting. We ask Allaah to keep us safe and sound. 

A wise person must be content with that which is halaal and not to keep running after what is haraam because he will never get anything from it except loss and doom. May Allaah help us all to do that which He loves and which pleases Him.  And Allaah knows best.

2. Praise be to Allaah.

Firstly: 

If your work does not involve dealing with riba or approving it or helping with it, or dealing with other haraam things apart from riba, then it is permissible work and there is no sin on you if you continue it, even if the company takes riba-based loans or pays riba. But it is better to leave this job and work for a company that is far removed from this great evil because it is established among the scholars that it is makrooh to engage in buying and selling and renting etc with persons whose wealth includes haraam wealth. 

Secondly: 

It is not permissible to write down riba or to document it. The one who does that is cursed by the Messenger of Allaah (peace and blessings of Allaah be upon him), as Muslim (1598) narrated that Jaabir (may Allaah be pleased with him) said: “The Messenger of Allaah (peace and blessings of Allaah be upon him) cursed the one who consumes riba, the one who pays it, the one who writes it down and the two who witness it, and he said: ‘They are all the same.’” 

Following up on these documents and supervising them is haraam, because it is cooperating in sin and transgression, and approving of evil. Allaah says (interpretation of the meaning): 

“Help you one another in Al‑Birr and At‑Taqwa (virtue, righteousness, and piety); but do not help one another in sin and transgression. And fear Allaah. Verily, Allaah is Severe in punishment” [QS al-Maa’idah 5:2]

What you have to do is advise those who are in charge of this company to give up this great evil. If they respond, then praise is to Allaah, otherwise, you must avoid recording and documenting riba, and keep away from everything that involves helping in sin or approving of it. And Allaah knows best.

3. Praise be to Allaah.

It is not permissible to join pyramid marketing schemes, because they are based on deception, gambling and consuming people’s wealth unlawfully. If a person buys some product and does not want to enter into this scheme, but the company brings him into it, it is not permissible for him to continue subscribing, because continuing in an invalid contract is like entering into it in the first place. 

Hence the Prophet (blessings and peace of Allah be upon him) said in his Farewell Sermon: “The riba of the Jaahiliyyah is abolished, and the first riba that I abolish is our riba, the riba of ‘Abbas ibn ‘Abd al-Muttalib; it is all abolished.” Narrated by Muslim, 1218. 

The Prophet (blessings and peace of Allah be upon him) stated that invalid riba-based contracts of the Jaahiliyyah were abolished and that it was haraam to continue with them, even though they had been drawn up before that, and in fact had been drawn up before the prohibition on them had been revealed from Allah. This is clear in the words of Allah, may He be exalted (interpretation of the meanin ): “So whosoever receives an admonition from his Lord and stops consuming Riba, shall not be punished for the past; his case is for Allaah (to judge); but whoever returns (to Riba), such are the dwellers of the Fire — they will abide therein” [QS al-Baqarah 2:275]. And Allah knows best.

4. Praise be to Allaah.

There is nothing wrong with the worker subscribing to a retirement scheme or state insurance fund, if doing so is compulsory as is the case in some countries, because the worker is excused for that and the money is taken from him without his choice. Hence many scholars regard it as permissible to make use of what comes from this scheme, and they regarded the extra amount from the state as coming under the heading of the state’s duty to take care of the weak and look after them. 

But in the case of voluntary subscription, it is not permissible to subscribe to this fund, because it is based on gambling and uncertainty. The individual may take more than he paid or he may take less than that, and this is gambling. Moreover, the money is deposited in riba-based banks, as you stated, and it is well known that it is not permissible to deposit money in riba-based banks with the aim of getting the interest, because that is consuming riba and helping those who deal in riba. And Allah knows best.

5. Praise be to Allaah.

There is no sin on the children of one who deals in riba even if he spends purely riba-derived money on their food, clothes or travel, if they have no other way of earning a living. They have to advise their father in the manner which they think will be most effective. If it is easy to find other means of earning a living, or they do not need that money for the essentials of living, then they have to do without it. 

Shaykh Ibn ‘Uthaymeen (may Allaah have mercy on him) said: If the father’s earnings are haraam, then it is essential to advise him.  Either you can advise him yourselves if you are able to do that, or you can seek the help of scholars who can convince him or of his friends may be able to convince him to avoid these haraam earnings. But if that is not possible then you may benefit from it as much as is necessary, and there is no sin on you in this case, but you should not take more than you need because of doubts as to whether it is permissible to benefit from one whose earnings are haraam. (Fataawa Islamiyyah, 3/452). 

If a father who deals in riba dies, his heirs must get rid of the riba-based money by returning it to its owners if they are known. Otherwise, they should get rid of it by spending it on charity, whether that is given individuals or to institutions. If it is too difficult for them to find out exactly how much of their father’s wealth is riba-based, they should divide it in half, taking one half and distributing the other half.  

Shaykh al-Islam Ibn Taymiyah was asked about a man who dealt in riba, and who left behind wealth and a son who knew his father’s situation – was the wealth permissible for the son as inheritance or not? He replied: with regard to the amount that the son knows is riba-based, he should get rid of it, either by returning it to its owners if possible, and he should not give it in charity. The rest is not haraam for him. With regard to the amount concerning which there is doubt, it is mustahab for him not to take it unless it is needed to pay off a debt or to spend on dependents. If the father died when engaging in riba-based transactions that are allowed by some fuqaha’, it is permissible for the heir to benefit from them. If the halaal and haraam are mixed and the extent of each is unknown, it should be divided into two halves. (Majmoo’ al-Fataawa, 29/307).  And Allaah knows best.

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(Source: https://islamqa.info/en/answers ). 

Related Questions were combined, and answered by Islam Q&A Team with general supervised by Syaikh Muhammad Saalih al-Munajjid, with small revision and adjustment by Editor: Ustaz Sofyan Kaoy Umar, MA, CPIF. e-mail: ustazsofyan@gmail.com