Ruling on letter of credit issued by the bank

I work in a private institution and my work requires me sometimes to arrange a letter of credit from the bank (I do that at the Raajihi Bank and sometimes at al-Ahli Bank). This is one of the conditions of submitting bids for government contracts… My question is, is getting a letter of credit from the bank permissible or not?.

Praise be to Allaah.

Letters of credit from the bank are subject to further discussion:

1.

If it is completely covered by the customer, there is nothing wrong with the bank taking a fee from the customer, because this comes under the heading of appointing someone to act on one’s behalf, and acting on someone’s behalf in return for a fee is permissible, just as it is also permissible to do so for free. 

It is not permissible for the trustee of a charity to borrow money for himself from the charity’s funds

I have been entrusted with the funds of some charitable organizations. Sometimes I need to take some of this money, then I put it back within a short time. That is because when I go out sometimes and I do not have my own cash with me, I take some of this money, then I put it back straightaway. But I do not take it because I don’t have any money; rather I take it because of what I mentioned. What is the ruling on this action?.

Praise be to Allaah.

It is not permissible for the trustee of a charity to dispose of the charity’s funds except within the limits that serves its interests, according to what has been approved by the administration and he has been appointed to do. That is because the trustee of the charitable organization has been entrusted with the money that is under his control, so he has to take care of it and look after it, and not dispose of it except in the ways permitted by the administration. He does not have the right to go against that, even if it is only a small amount, because a small amount may lead to a greater amount. 

There is no zakaah on money that is being held as compensation for taking land

The state took away some land of mine in order to build a road, and gave me compensation for taking away the land, but I cannot take possession of this money until several years have passed. Do I have to pay zakaah on it?.

Praise be to Allaah.

You do not have to pay zakaah on this money until you take possession of it; when you take possession of it you should count one (hijri) year from the day you took possession of it, then pay zakaah on it after one year.

Shaykh Ibn Baaz (may Allaah have mercy on him) was asked a similar question, and he replied: If property has been seized and its value estimated, but the owner has not been able to take possession of it due to reasons beyond his control, no zakaah is due on it until he takes possession of its price and a full year has passed. End quote.

Majmoo’ Fataawa Ibn Baaz (14/41)

And Allaah knows best.

If a person’s haraam money is stolen, does he have to dispose of it a second time?

A man had some stocks and shares in a riba-based bank, from which he earned money which he took and kept in his house. A thief entered and stole the money, then the man repented. Does he have to dispose of the money a second time?

Praise be to Allaah.

We put this question to Shaykh Muhammad ibn Saalih al-‘Uthyameen, may Allaah preserve him, who answered:

No, he does not have to do anything.

Question:

Is that because he has repented?

Answer:

Yes.

Question:

So we can say that because he has repented, he does not have to dispose of the money a second time?

Answer:

Yes, he does not have to do anything.

And Allaah knows best.

He stole some public property which was then stolen from him

A man stole something from a public facility in a kaafir country, then it was stolen from him. Does he have to repay its value?

Praise be to Allaah.

We put this question to Shaykh ‘Abd-Allaah ibn Jibreen (may Allaah preserve him), who answered as follows:

He is not liable for anything; it is sufficient for him to repent. And Allaah knows best.

Ruling on raising the price of a product in order to extend the warranty

What is the ruling on raising the price of a product in order to extend the warranty?

Praise be to Allaah.

We put this question to Shaykh ‘Abd-Allaah ibn Jibreen, may Allaah preserve him, who replied as follows:

There is nothing wrong with it if it is done with the agreement of both parties… but selling separate warranty certificates is not permitted. And Allaah knows best.

She took a ring from her mother without permission and lost it

One day I took a ring from my mother without her knowing, and by mistake I lost it. I was looking for it and I did not tell her that I had taken it and lost it. Please note that I was only twelve years old. Now I regret it deeply and I want to expiate for my sin. What should I do? Please advise me, may Allaah reward you with good.

Praise be to Allaah.

You did a mistake when you took the ring without permission and when you did not tell your mother after you lost it. What you have to do now is to tell your mother and ask her for forgiveness, and to compensate her with a ring like the one that she had. Because whoever takes the property of someone else without permission is a robber or one who seizes property unlawfully, and he must replace what he has taken. If this was done at a young age, below the age of adolescence, then the burden of sin is lifted, but the obligation to replace the item still remains, because the scholars have stated that a child must replace things that he has destroyed and make up for the loss in value that may have affected the things he took, then return them (to their owner).

But if you think that telling her about this will most likely lead to a breakdown in relations or problem between you, then simply give her a ring, even if it appears to be a gift.

And Allaah knows best.

Ruling on making use of and investing money with which one has been entrusted

Someone entrusted some money to me and I made use of this money by investing it. When the owner of the money came, I gave him all of his money, but I did not tell him how I had made use of it. Was what I did permissible or not?

Praise be to Allaah.

If anyone entrusts something to you, you do not have the right to use it without his permission… you have to keep it and take care of it in the manner that is usual. If you make use of it without his permission, you have to seek his forgiveness. If he forgives you, then all well and good; otherwise you have to give him the profit made with his money, or try to reach some agreement with him to take half each, or some other agreement. It is permissible to make agreements and reconcile among Muslims, except for agreements that make something that is halaal haraam or vice versa.

The owner of the goods left before taking payment

I bought some goods from a person on the basis that I would pay him for them afterwards. Then I travelled and when I came back, I found out that he had left, and I could not find out where he is now. I left my address with his friends, but he has never got in touch. What should I do?

Praise be to Allaah.

You have to ask the people who know him and make the effort to find out where he is, then send the money to him, or else go and see him and give him what is due to him, because the Prophet (peace and blessings of Allaah be upon him) said: “Every Muslim is sacred to another Muslim in his blood, his wealth and his honour.” It is not permissible for you to take the matter lightly. If you are unable to find him, then give the money in charity on his behalf, with the intention of repaying him too. If you then find him, then give him the choice between getting what is owed to him, in which case you will have the reward of giving in charity, or accepting the fact that you gave it in charity, in which case the reward will be his. Allaah says (interpretation of the meaning):

“So keep your duty to Allaah and fear Him as much as you can” [al-Taghaabun 64:16]

“Allaah burdens not a person beyond his scope” [al-Baqarah 2:286]

Is it permissible to act as guarantor for a person taking a loan from the bank?

What is the Islamic ruling on acting as guarantor for a person taking a loan from the bank?.

Praise be to Allaah.

If this loan is riba-based (as is the case with most banks), meaning that the bank will take interest from him, then it is not permissible for you to act as a guarantor for the borrower, because by doing so you are helping the borrower and the bank to engage in riba (usury, interest), which is forbidden by Allaah and His Messenger, and which the Muslims are unanimously agreed is haraam.

The scholars of the Standing Committee were asked about the ruling on sponsoring a person who wants to borrow from a riba-based bank. They replied:

If the situation is as described, and the bank will charge interest on the loan, it is not permissible for the manager, the accountant or the treasurer to cooperate with them in that, because Allaah says (interpretation of the meaning):

“do not help one another in sin and transgression”

[al-Maa’idah 5:2]