Category: Riba, Loans and Working in Banks

Another Fatwa regarding plotting to indulge in Riba

Question :

I have a number of bags of rice and they are in a storage facility that we have. People come to me and buy it from me for its price in the market and they loan it (the rice) to other people. Then when it becomes the possession of the debtor, I take it (the rice) back from him for one riyal less than what it was bought for from me. Then, some other people like them come after the rice is back with me and they buy it from me, and so forth. All the while, the rice is in one place, but they are considered to have received it while it is in its same place. Is this method sinful or not? Please give us a beneficial answer. May Allâh reward you with good.

Answer:

Yes, this method is a scheme to indulge in Riba. It is compounded Riba that combines between delayed pay- ment and different commodities, meaning it combines between Riba Al-Fadhl and Riba An-Nasi'ah. This is because loaner is using this as a means of getting 12 for 10, for example. Sometimes the loaner and the debtor agree to this before they come to the owner of the shop. They agree that the loaner will loan him such-and-such amount of cash-like 10 for payment of 12 or more or less - then they come to this merchant to carry out this trickery with him. Shaykhul-Islam Ibn Taimiyyah called this Al-Heelah Ath-Thalathiyah (the Threesome Scheme). It is no doubt a scheme to practice Riba - Riha An-Nasi'ah and Riba Al- Fadhl - and thus it is forbidden and it is among the major sins. This is because the forbidden does not change to being allowed by scheming to carry it out. Rather, scheming to perform it increases it in wickedness and it increases it in sin. For this reason it has been mentioned from Ayyub As-Sakhtiyani that he said concerning these schemers: "Verily, they seek to deceive Allâh just as they seek to deceive children. If they did the act forthright, it would have been lesser in sin." And what he said is true, may Allâh have mercy on him. For verily, the schemer is in the position of the hypocrite who presents himself as a believer while he is actually a disbeliever. This person is scheming to practice Riba while making it seem as though his sale is a correct and lawful sale.

Source:
Ash-Shaykh Ibn 'Uthaimin
Fatawa Islamiyah, Vol. 3 Pages 351-352