The ethical framework for a Muslim investor

Money, money, money. Doesn't it make your head spin sometimes?Think of
all the things you can do if you just had a little more…
Unfortunately, this compelling greed and need sometimes drivesus to
make financially unsound decisions, and worse still, even un-Islamic
ones. The following article outlines various aspects ofIslamic
financial dealings, from paying the one you hire to what not to pay
when you owe someone. There are so many evidences with regard to
Islamic finance that they cannot and must not be ignored. If you ever
intend to spend another dollar, you must read on.
The Hirer and the Laborer
Nothing bonds employees to their place of work more than the
fulfillment of their contractual rights, including receiving their
wages on time – such treatment fosters loyalty and a sense of
belonging as well as financial security for themselves and their
family. The Prophet said: "Give the laborer his wages before his sweat
dries away." [Ibn Maajah]. He gave a stern warning to those who do not
meet their obligations by saying: "Allaah Almighty Said (what means):
'I will be an opponent to three types of people on the Day of
Resurrection: one who makes a covenant in My name, but proves
treacherous; one who sells a free person and eats his price and onewho
employs a laborer and takes full work from him, but does not pay him
for his labor.'" [Al-Bukhaari].
Our Wealth and Charity
However, the highest among the list of financial obligations is thatof
our obligation toward our Creator. The rich begin to fulfill this
obligation by giving Zakaah to the poor and they continue the
fulfillment by giving charitable donations whenever needed. Fulfilling
one's obligationtowards Allaah purifies the capital from inadvertent
errors and suspicion, as well as purifies the soul from stinginess and
selfishness.
Charity does not eat away capital,rather it increases it. On the
otherhand, withholding Zakaah is a direct reason for bankruptcy. When
people withhold Zakaah, Allaah withholds rain from them and if it were
not for the sake of preserving cattle and wildlife, therain would
cease altogether. Evidence abounds on these issuesfrom both the Quran
and Sunnah.
Allaah Says (what means): "… Andthose who hoard gold and silver and
spend it not in the way of Allaah – give them tidings of a painful
punishment. The Day when it (the gold and silver whose Zakaah was not
paid) will be heated in the Hellfire and seared therewith will be
their foreheads, their flanks and their backs, (it will be said),
'This is what you hoarded for yourselves,so taste what you used to
hoard.'" [Quran 9:34-35].
Allaah also Says (what means): "And those within whose wealth is a
known right (Zakaah). For thepetitioner and the deprived." [Quran
70:24-24].
And in another verse, Allaah Says (what means): "Take, (O Muhammad),
from their wealth a charity by which you purify them and cause them
increase, and invoke (Allaah's blessings) upon them. Indeed, your
invocations are reassurance for them. And Allaah is Hearing and
Knowing." [Quran 9:103].
The Prophet said: "No owner of treasure who does not pay Zakaah (would
be spared) but (his hoard) would be heated in the Hellfire. These
would be made into plates and with these, his sides and his forehead
would be cauterized till Allaah pronounces judgment among Hisservants
during a Day, the extent of which would be fifty thousand years. He
would then see his path, leading either to Paradise or to Hellfire…"
[Muslim].
One has only to regard the effect that Zakaah has on society to
recognize its importance. The money is paid by the rich in orderto
fulfill their obligation towards Allaah, and then used by the poorto
relieve their suffering. In a society where giving and receiving are
carried out in good faith, the poor live peacefully with the rich in a
flourishing and stable solidarity. The Prophet gave an example of this
society by saying: "When the Ash'arites run short of provisions in the
campaigns or run short of food for their children in Al-Madeenah, they
collect whatever is with them in a cloth and then partake equally from
one vessel. They are from me and I am from them." [Al-Bukhaari].
Avoiding Ribaa (Interest)
A careful analysis of the history ofcivilizations reveals a common
root to all turmoil and political unrest – and that root is usury.
This is the reason why Islam tookan extremely firm stand on the issue
of interest.
Muslim investors should be extremely careful to avoid engaging in
transactions involving interest or in any transaction involving
interest masquerading as a seemingly lawful transaction.
Allaah forbade interest and threatened those who take it with severe
punishment, when He Says (what means):
"Those who consume interest 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 interest.' But Allaah has
permitted trade and has forbidden interest. So whoever has received an
admonition from his Lord and desists may have what is past, and his
affair rests with Allaah. But whoever returns (to dealing in interest
or usury) – those are the companions of the Fire; they will abide
eternally therein. Allaah destroys interest and gives increase for
charities. And Allaah does not like every sinning disbeliever." [Quran
2:275-276].
Allaah Almighty declared war against those who take interest and
encouraged lenders to be patient with borrowers to the point of
absolving them from all, or part, of the loan in the following verse,
when He Says (what means):
"O you who have believed, fear Allaah and give up what remains (due
to you) of interest, if you should be believers. And if you donot,
then be informed of a war (against you) from Allaah and His Messenger.
But if you repent, youmay have your capital – (thus) you do no wrong,
nor are you wronged. And if someone is in hardship, then (let there
be) postponement until (a time of) ease. But if you give (from your
right as) charity, then it is better for you, if you only knew."
[Quran 2:278-281]
Islam's ruling on taking interest is very straightforward and severe.
It is considered to be one of the seven mortal sins. The Prophet said:
"Avoid the seven great destructive sins." Thepeople inquired: 'O
Allaah's Messenger! What are they?' He said: 'To join others in
worship along with Allaah, to practice sorcery, to take the life which
Allaah has forbidden except for a just cause (according to Islamic
law), to eat up Ribaa (usury), to eat up an orphan's wealth, to show
one's back to the enemy and fleeing from the battlefield at the time
of fighting; and to accuse chaste women, who do not have any unchaste
thoughts and are good believers.'" [Al-Bukhaari].
The Prophet went on to cursethe taker of interest, its payer and also
the one who records it, including the two witnesses. He said: "They
are all equal." [Muslim].
The Prophet further said: "This night I dreamt that two men came and
took me to a holy land whence we proceeded on tillwe reached a river
of blood, where a man was standing, and on its bank was standing
anotherman with stones in his hands. The man in the middle of the
river tried to come out, but the other threw a stone in his mouthand
forced him to go back to his original place. So, whenever he tried to
come out, the other man would throw a stone in his mouth and force him
to go back to his former place. I asked: 'Whois this?' I was told:
'The person inthe river used to eat Ribaa.'"