(Series of Answers by the Eminent Scholar Ata Bin Khalil Abu al-Rashtah, Ameer of Hizb ut-Tahrir, to Questions from Visitors to his Facebook Page "Fiqhi")
Question:
Assalamu Alaikum Wa Rahmatullahi Wa Barakatuhu,
A question from the book The Institutions of State in the Khilafah regarding riba (usury) funds after the establishment of the Khilafah state by giving the capital back to its owners... The question is: What will we do with the riba funds? Is it permissible for the state to seize and invest them? And is the currency that comes from the riba of money, such as a banknote, haram in itself, or does the prohibition relate to the action?
Answer:
Wa Alaikum Assalam Wa Rahmatullahi Wa Barakatuhu,
1- Regarding the answer to your question "What will we do with the riba funds...", this answer is found in the book The Funds in the Khilafah State. It clarifies how the state handles wealth acquired through illegal means, such as ghulul (misappropriated wealth), riba, gambling, etc. In the chapter: "Wealth of Ghulul from Rulers and State Employees, Illegally Acquired Wealth, and Fines" on pages 111-112, the following is stated:
"All that has been mentioned regarding what governors, assistants, and state employees acquire through illegal means becomes part of the revenues of the Bayt al-Mal. Along with this, any wealth acquired by individuals through means that are Shari’ah-prohibited for ownership or the development of property is also considered revenue for the Bayt al-Mal, because it is a haram earning and cannot be owned.
Whoever acquires something through riba is haram and it is not owned, because Allah has forbidden riba and forbidden the development of wealth through it. He (swt) says:
الَّذِينَ يَأْكُلُونَ الرِّبَا لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ الَّذِي يَتَخَبَّطُهُ الشَّيْطَانُ مِنَ الْمَسِّ ذَلِكَ بِأَنَّهُمْ قَالُوا إِنَّمَا الْبَيْعُ مِثْلُ الرِّبَا وَأَحَلَّ اللَّهُ الْبَيْعَ وَحَرَّمَ الرِّبَا فَمَنْ جَاءَهُ مَوْعِظَةٌ مِنْ رَبِّهِ فَانْتَهَى فَلَهُ مَا سَلَفَ وَأَمْرُهُ إِلَى اللَّهِ وَمَنْ عَادَ فَأُولَئِكَ أَصْحَابُ النَّارِ هُمْ فِيهَا خَالِدُونَ
“Those who consume riba cannot stand [on the Day of Resurrection] except as one stands who is being beaten by Satan into insanity. That is because they say, ‘Trade is [just] like riba.’ But Allah has permitted trade and has forbidden riba. So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allah. But whoever returns to [dealing in riba or usury] - those are the companions of the Fire; they will abide eternally therein.” (Surah Al-Baqarah [2]: 275)
And He (swt) says:
يَا أَيُّهَا الَّذِينَ آمَنُوا اتَّقُوا اللَّهَ وَذَرُوا مَا بَقِيَ مِنَ الرِّبَا إِنْ كُنْتُمْ مُؤْمِنِينَ * فَإِنْ لَمْ تَفْعَلُوا فَأْذَنُوا بِحَرْبٍ مِنَ اللَّهِ وَرَسُولِهِ وَإِنْ تُبْتُمْ فَلَكُمْ رُءُوسُ أَمْوَالِكُمْ لَا تَظْلِمُونَ وَلَا تُظْلَمُونَ
“O you who have believed, fear Allah and give up what remains [due to you] of riba, if you should be believers. And if you do not, then be informed of a war [against you] from Allah and His Messenger. But if you repent, you may have your principal - [thus] you do no wrong, nor are you wronged.” (Surah Al-Baqarah [2]: 278-279)
The riba money must be returned to its people from whom it was taken if they are known. If they are not known, it is confiscated and placed in the Bayt al-Mal. This is in addition to the Shari'ah punishment resulting for those who deal in riba, whether the consumer, the provider, the clerk, or the witnesses, as mentioned in the noble Hadith:
لَعَنَ رَسُولُ اللهِ صَلَّى اللهُ عَلَيْهِ وَسَلَّمَ آكِلَ الرِّبَا، وَمُؤْكِلَهُ، وَكَاتِبَهُ، وَشَاهِدَيْهِ
“The Messenger of Allah (saw) cursed the one who consumes riba, the one who gives it, the one who records it, and the two witnesses to it,” and he said: “They are all equal.” (Narrated by Muslim from Jabir).
Whoever acquires wealth through gambling (maysir), his earning is haram and it is not owned. It must be returned to its owner; if the owner is not known, it is confiscated and placed in the Bayt al-Mal. This is in addition to the Shari'ah punishment for those who deal in gambling, whether losing or winning. This is because the development of ownership through gambling is not permitted by Shari'ah, as gambling is forbidden. He (swt) says:
يَا أَيُّهَا الَّذِينَ آمَنُوا إِنَّمَا الْخَمْرُ وَالْمَيْسِرُ وَالْأَنْصَابُ وَالْأَزْلَامُ رِجْسٌ مِنْ عَمَلِ الشَّيْطَانِ فَاجْتَنِبُوهُ لَعَلَّكُمْ تُفْلِحُونَ * إِنَّمَا يُرِيدُ الشَّيْطَانُ أَنْ يُوقِعَ بَيْنَكُمُ الْعَدَاوَةَ وَالْبَغْضَاءَ فِي الْخَمْرِ وَالْمَيْسِرِ وَيَصُدَّكُمْ عَنْ ذِكْرِ اللَّهِ وَعَنِ الصَّلَاةِ فَهَلْ أَنْتُمْ مُنْتَهُونَ
“O you who have believed, indeed, intoxicants, gambling, [sacrificing on] stone alters [to other than Allah], and divining arrows are but defilement from the work of Satan, so avoid it that you may be successful. Satan only wants to cause between you animosity and hatred through intoxicants and gambling and to avert you from the remembrance of Allah and from prayer. So will you not desist?” (Surah Al-Ma'idah [5]: 90-91)"
2- As for the second part of the question regarding whether riba money is haram in itself (bi'aynihi) or due to the action (bi al-fi'l)... The answer is that wealth acquired through an illegal action is not haram in its essence (dhatuhu). Rather, the prohibition applies to the method of its acquisition or development. As for the physical money itself, it is not haram. For example, if someone earns dinars by selling alcohol or through riba, the dinars themselves do not become haram in their essence; the prohibition is in the manner of earning or developing them. Therefore, the one who earned them through haram means does not own them. However, the physical money is not haram, and for this reason, it is placed in the Bayt al-Mal of the Muslims and spent on their affairs. No exception is made from this except for wealth that is haram in its physical essence, such as pigs and wine, as these are prohibited in their very nature.
Your brother, Ata Bin Khalil Abu al-Rashtah
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