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The corpus already carries the rule that a muḍārib may not guarantee the capital (Res 30 on muqāraḍah bonds; the qirad ruling in Res 123), and the…

The corpus already carries the rule that a muḍārib may not guarantee the capital (Res 30 on muqāraḍah bonds; the qirad ruling in Res 123), and the newly added hedging answer-key (Res 238) leans on it for its guarantee head. This is the Academy's OWN full treatment of the question a saver actually asks — is my bank on the hook if it loses my investment deposit? Resolution No. 212 (8/22) 'Bank Guarantee for Misinvestment of Clients Funds and Compensation for the Consequent Losses' (22nd session, Kuwait City, State of Kuwait, 22-25 March 2015). It separates the two ways a bank holds your money — under guarantee (a current account, which is a loan the bank must repay on demand) and under trusteeship (an investment account run on muḍārabah, which it may NOT guarantee) — then rules exactly when the bank DOES owe you: only on transgression, negligence or breach, and only for actual harm, never for the profit you hoped for. This is the text a reader should hold against any 'capital-protected Islamic deposit'.

What this source says

THE QUESTION EVERY SAVER ASKS. Put money in an Islamic bank and one question decides whether the arrangement is riba-free or a fixed return in disguise: if the bank invests your money and loses it, does it owe you the money back? Resolution No. 212 (8/22) answers it head-on. Its first head defines the problem plainly — 'Bank guarantee means that the bank bears the total or partial loss of depositors and owners of investment accounts' funds.' The rest of the resolution says when that guarantee is owed and when demanding it destroys the contract.

TWO WAYS A BANK HOLDS YOUR MONEY. The second head draws the line the whole ruling turns on. A bank holds funds in one of two capacities. HOLDING UNDER GUARANTEE 'means holding the funds as an owner, or to its own benefit as a holder' — this is the ordinary current account, and here the Academy reiterates its resolution no. 86 (9/3) that 'Demand (current) deposits with Islamic banks are loans in the Fiqh perspective, because the receiving bank holds them under guarantee, and is committed, according to Shariah, to repay them on demand.' A current account IS a loan; of course the bank repays it in full. HOLDING UNDER TRUSTEESHIP is the opposite — 'holding the funds on behalf of rather than in the capacity of an owner.' Investment deposits fall here: they are muḍārabah capital, and the Academy reconfirms the qirad rule that this carries the 'impermissibility of guaranteeing Muḍārabah capital by the Muḍārabah worker/muḍārib' — the bank. The saver who wants an investment return is a capital-provider in a partnership, not a lender, and a partner shares the downside.

WHEN THE BANK DOES OWE YOU. The rule is not that the bank never pays. The third head sets the trigger: 'It is not permissible for the bank, when assuming the role of the muḍārib, to guarantee total or partial loss of investment accounts, except in case of transgression negligence or breach of contract, as indicated by the general rules of Shariah.' It then lists what counts as transgression — beginning with 'Noncompliance of the bank with Shariah criteria stipulated in contracts and agreements of opening investment accounts in all their different types', and running through violating banking regulations, slack feasibility studies, wrong operational modes, ignoring internal directives, and failing to obtain sufficient collaterals. Lose the money through any of those and the bank is liable; lose it in an honest, competent investment and it is not.

WHAT YOU MAY NOT STIPULATE. The fourth head closes the obvious loophole — writing the guarantee into the contract up front. 'It is not permissible to stipulate a guarantee by the bank as a muḍārib because such stipulation contradicts the essence of the Muḍārabah contract', and the Academy reconfirms its resolutions no. 86 and no. 30 (5/4) on muqāraḍah bonds that a muḍārabah working party may not be made to 'guarantee the capital or any lump sum or percentage return on capital.' A stipulated guarantee does not make the deposit safe; it makes the contract void. The fifth head is a practical protection for the saver: 'In a legal suit of loss, the burden of proof shifts - contrary to the case in principle - to the bank' — the muḍārib must prove it did not transgress, because it, not the depositor, controlled the money. The sixth head permits a bank to smooth returns only by genuine gift: 'It is permissible for the bank to donate part of its profit share without stipulating that in the contract' — a donation, never a promised top-up.

ACTUAL HARM ONLY, NOT LOST PROFIT. The eighth head fixes the size of any compensation. 'Compensation for losses in investment accounts should be confined to actual harm - whether the loss is total or partial - without guaranteeing potential profit that has not been realized (opportunity cost) because it is nothing more than an unrealized expectation not actually materialized.' Even where the bank is at fault, it owes the money it mishandled, not the gains you imagined you would have made. The seventh head notes that supervisory bodies, arbitration centres and external auditors are the ones normally entrusted with deciding whether the bank abused the funds.

HOW IT CLOSES. Like the corpus's other CONFINED rulings, Res 212 ends in a Recommendations section that looks forward without re-opening the ruling: 'Islamic banks should be keen while investing in depositors' funds to pursue methods and mechanisms that would mitigate investment risks and' safeguard them, through special funds and reserves; and 'Muslim countries are called upon to enact laws for the establishment of institutions for deposits insurance' or cooperative-insurance funds, pointing to the Academy's own resolution no. 200 (6/21) on cooperative insurance. It signs off, as these resolutions do, 'Indeed, Allāh is All-Knowing.'

HOW TO CITE IT HONESTLY. Res 212 is SETTLED, not a deferral: it 'Resolves' across eight ordinal heads and defines, triggers and bounds the bank's liability. It is CONFINED — it carries a Recommendations section — but the subject is decided in the body. It grades no company and blesses no branded product; a saver shown a 'capital-protected Islamic deposit' with a certified board is not being shown this text — they are being shown a product this text tells them how to interrogate: is my money held under guarantee (then it is a loan, repaid in full but earning nothing lawful beyond it) or under trusteeship (then it is muḍārabah capital, and no one may promise it back except on proven fault, and never the profit I hoped for). What Res 212 adds to a riba-free life is the exact boundary between a deposit that is a loan and a deposit that is a partnership — and the plain warning that a promised return on the second is the contract voiding itself.

Wording inside quotation marks is quoted from the source. The rest is this notebook’s summary of it — read the original before relying on it.

Provenance

Compiled from: Compiled 2026-07-21 from the International Islamic Fiqh Academy's OWN OFFICIAL ENGLISH text of the resolution. PRIMARY AND SOLE AUTHORITY FOR EVERY VERBATIM SPAN ATTRIBUTED TO RES 212: the Academy's OFFICIAL ENGLISH EDITION, 'Resolutions and Recommendations of the International Islamic Fiqh Academy' (official edition, October 2021, published by the Academy at iifa-aifi.org), which prints the ruling as 'Resolution No. 212 (8/22) / Bank Guarantee for Misinvestment of Clients Funds and Compensation for the Consequent Losses' with the session line 'holding its 22nd session in Kuwait City, State of Kuwait, on 2-5 Jumādā al-Ākhirah 1436h (22-25 March 2015),'. TWO SECOND BLOCKS are loaded ONLY as settledness negative controls and quoted only for their identifying lines and their deferral wording: Resolution No. 187 (2/20) 'Cooperative Insurance: Shariah Rulings and Criteria' — a genuine whole-subject deferral whose 'Resolves' ends by requiring an integrated conception that 'need to be developed' and a draft 'submitted to the forthcoming session ... for drafting a resolution', which the PARAPHRASE gate catches although it carries NO deferral KEYWORD (the Res 200 finding, made concrete); and Resolution No. 124 (6/13) 'Medical Insurance and Medical Cards' — a deferral both gates catch (its 'Resolves' is a bare 'Postponement ... to a forthcoming session, for conducting further research'). A span verified against the wrong block would be a fabrication, so the span table is keyed by block and the union is never used. Gate: build_res212.py; audit_res212.py re-extracts every quoted span from the finished JSON and re-verifies it against the source.
Source: PRIMARY TEXT (full title; session, city, country and dates; the two recitals; the 'Resolves' with its eight heads — the definition of bank guarantee, the two holding capacities, the muḍārib's conditional non-liability with the transgression list, the ban on stipulating a guarantee, the burden-of-proof shift, the permitted donation, the bodies determining abuse, and the confinement of compensation to actual harm — and the Recommendations section): International Islamic Fiqh Academy (OIC), 'Resolution No. 212 (8/22): Bank Guarantee for Misinvestment of Clients Funds and Compensation for the Consequent Losses', in 'Resolutions and Recommendations of the International Islamic Fiqh Academy', OFFICIAL ENGLISH EDITION, October 2021, published by the Academy at iifa-aifi.org — the SOLE authority for every verbatim span attributed to Resolution 212. TWO SECOND BLOCKS, loaded ONLY as settledness negative controls and quoted only for their identifying lines and deferral wording: Resolution No. 187 (2/20) 'Cooperative Insurance: Shariah Rulings and Criteria' (20th session, Oran, Algeria, 2012) — a genuine whole-subject deferral (its 'Resolves' requires an integrated conception that 'need to be developed' and a draft 'submitted to the forthcoming session ... for drafting a resolution') caught by the PARAPHRASE gate although it carries NO deferral KEYWORD, so it demonstrates the Res 200 finding that a keyword pass alone is insufficient; and Resolution No. 124 (6/13) 'Medical Insurance and Medical Cards' (13th session, 2001) — a deferral BOTH gates catch (its 'Resolves' is a bare 'Postponement ... to a forthcoming session, for conducting further research'). NOT a two-independent-translation gold pairing and cannot be: the IRTI/IDB English edition covers 1985-2000 only and this is a March-2015 ruling (same constraint as Res 123/136/137/139/153/158/170/177/178/186/200/224/238). No live per-resolution page on iifa-aifi.org was confirmed for Res 212 this run, so none is cited and the url field points at the edition itself. VERIFICATION: build_res212.py hand-lists every quoted span and verifies each as an exact substring of the official-edition extraction under canonical normalisation, keyed by block; audit_res212.py re-extracts every quoted span from the FINISHED JSON on disk and re-verifies it against the source.
School / basis: Comparative fiqh al-muʿāmalāt (ḍamān / the muḍārib's guarantee of investment-account funds) with a PRIMARY OIC collective text. Resolution No. 212 (8/22), 22nd session (Kuwait City, State of Kuwait, 2-5 Jumādā al-Ākhirah 1436h / 22-25 March 2015). Operative shape: a 'Resolves' across EIGHT ordinal heads — First (defines bank guarantee as the bank bearing total or partial loss of depositors' and investment-account owners' funds); Second (the two capacities in which a bank holds funds — holding under GUARANTEE, i.e. a current/demand deposit which per Res 86 (9/3) is a loan the bank must repay on demand; and holding under TRUSTEESHIP, i.e. an investment deposit which is muḍārabah capital carrying the qirad rule that the muḍārib may not guarantee it); Third (the bank as muḍārib may NOT guarantee total or partial loss of investment accounts EXCEPT on transgression, negligence or breach, with a six-item list of what constitutes transgression); Fourth (a guarantee may not be STIPULATED because it contradicts the essence of the muḍārabah contract, reconfirming Res 86 and Res 30 (5/4) on muqāraḍah bonds that the working party may not guarantee capital or a fixed/percentage return); Fifth (in a loss suit the burden of proof shifts to the bank/muḍārib); Sixth (the bank may DONATE part of its profit share without stipulating it in the contract); Seventh (supervisory bodies, arbitration centres and external auditors normally determine whether the bank abused the funds); Eighth (compensation is confined to ACTUAL HARM, never unrealized potential profit / opportunity cost). Closes with a Recommendations section (banks to pursue risk-mitigation via special funds and reserves; states to enact laws for deposits-insurance or cooperative-insurance funds, pointing to Res 200 (6/21)). CONFINED (a Recommendations section is present) but SETTLED — the subject is decided in the body, not postponed. RELATION TO THE CORPUS: it is the applied, saver-facing counterpart to the qirad no-guarantee rule already in the corpus (Res 30 / Res 123), and it is the guarantee-head authority the newly added hedging answer-key (Res 238) leans on. NO SCHOLAR, BOARD, VOTE COUNT OR MADHAB TALLY is claimed: the resolution names none, and none is inferred. NO SCRIPTURAL TEXT IS REPRODUCED: the preamble cites no verse or hadith by wording, grading or number; the closing formula is devotional, not a graded citation. The cross-references the resolution itself makes — to its resolutions no. 86 (9/3), 30 (5/4), 9 (9/2) and 200 (6/21), and to AAOIFI Accounting Standard No. 5 — are reported as Res 212 states them; the content of those resolutions is not reproduced beyond that reference.
Original: https://iifa-aifi.org/wp-content/uploads/2021/12/Resolutions-Recommendations-of-the-IIFA-Official-Edition-Oct-2021.pdf
Captured: 2026-07-21
Added: 2026-07-21
Trust: Primary or near-primary source with a stable public URL.

Compiler’s note

Added 2026-07-21 (auto-run). The OIC Fiqh Academy's applied, SETTLED ruling on the question a saver actually asks — is my bank liable if it loses my investment deposit? Res 212 (8/22), 22nd session, Kuwait City, State of Kuwait, 2-5 Jumādā al-Ākhirah 1436h (22-25 March 2015). It is the saver-facing companion to the qirad no-guarantee rule already in the corpus and the guarantee-head authority the previous run's Res 238 leans on. WHY THIS ONE. The previous run (Res 238) named Res 212 (8/22) as the leading next candidate — 'the mudarib's guarantee in investment accounts, referenced by Res 238's guarantee head and settled across several heads' — and a re-check ON DISK confirmed it. UNCOVERED: no content/articles/*resolution-212* file existed; the corpus held the no-guarantee-of-capital rule for muqāraḍah bonds (Res 30) and the qirad ruling (Res 123) but not the Academy's full, deposit-by-deposit treatment of when a bank IS and is NOT liable. SETTLED: its 'Resolves' rules the subject across eight ordinal heads (First-Eighth) and defines, triggers and bounds the guarantee; it is not a deferral. SUBSTANTIVE: it is a hold-a-product-against-it list — the two holding capacities, the transgression trigger, the ban on stipulating a guarantee, the burden-of-proof shift, and the confinement of compensation to actual harm. THE THREE SETTLEDNESS GATES (the Res 200 finding). Res 200 established that a bare keyword pass is insufficient because deferral by paraphrase defeats it. Res 212 passes all three cleanly on the source: 0 deferral KEYWORD matches (no postpon/defer token of any kind — its only near-token would be a transaction adjective, and none is present), 0 deferral PARAPHRASE matches, and 16 operative units (well above the floor of 5). The two negative controls are chosen to keep BOTH gates provably live on THIS run's source and are thematically tight to Res 212's own deposits/insurance subject: Res 187 (2/20) 'Cooperative Insurance' is the genuine deferral of the cooperative-insurance subject that Res 200 (which Res 212's own Recommendation cites) later settled — and it is caught by the PARAPHRASE gate ('need to be developed'; 'submitted to the forthcoming session ... for drafting a resolution') although it carries NO deferral KEYWORD, so it is the Res 200 finding made concrete (a real deferral the keyword gate alone would MISS). Res 124 (6/13) 'Medical Insurance and Medical Cards' is a deferral BOTH gates catch (a bare 'Postponement ... to a forthcoming session, for conducting further research'), keeping the keyword gate demonstrably live. The build ASSERTS the paraphrase gate catches Res 187, ASSERTS both gates catch Res 124, and REPORTS that the keyword gate does NOT fire on Res 187 (the point of the pairing). CONFINED, STATED HONESTLY (like Res 224/238/178/200). Res 212 carries a Recommendations section (two items — banks to pursue risk-mitigation via special funds and reserves; states to enact deposits-insurance / cooperative-insurance laws per Res 200). The subject IS ruled across eight heads; the Recommendations look forward without re-opening the ruling. The gate ASSERTS the Recommendations section is PRESENT so a future edition that removed it would fail loudly. WHAT IT ADDS that the corpus did not already hold: the exact, deposit-by-deposit boundary a saver needs. (1) The two holding capacities — under GUARANTEE (a current/demand deposit, which per Res 86 IS a loan repayable in full on demand) versus under TRUSTEESHIP (an investment deposit, which is muḍārabah capital the bank may NOT guarantee). (2) The liability trigger — the bank owes you nothing on an honest, competent loss, but IS liable on transgression, negligence or breach, with the resolution's own six-item transgression list. (3) The void-making loophole — a guarantee may not be STIPULATED, because it contradicts the essence of the muḍārabah contract and reconfirms the muqāraḍah-bond rule (Res 30) against guaranteeing capital or a fixed return. (4) The burden-of-proof shift onto the bank, the permission to DONATE (never promise) a top-up, and the confinement of any compensation to ACTUAL HARM, never unrealized profit / opportunity cost. HONEST SCOPE, NOT FABRICATION. Every cross-reference (Res 86, 30, 9, 200 and AAOIFI Accounting Standard No. 5) reports Res 212's OWN references; the content of those resolutions is not reproduced beyond the reference. No provider, scheme, jurisdiction, statute, rate or percentage is named. The named body examples in the seventh head (supervisory bodies, an arbitration centre, external auditors) are summarised, not quoted as endorsements. The word 'percentage' appears only inside the quoted muqāraḍah-bond rule the resolution reconfirms ('any lump sum or percentage return on capital'), as part of what is PROHIBITED; no figure or rate is asserted. HYPHENS: uses the single evidence-resolved reader from build_res139.py; the quoted spans were chosen to avoid line-break hyphenation and page-number interruptions, and the build re-checks the reader. DROPPED per no-fab: no scholar, no board, no provider graded, no madhab tally, no vote count, no figure, no rate, no fee, no threshold, no statute, no regulator. NO SCRIPTURAL TEXT: the preamble names no verse or hadith by wording, grading or number, so none is reproduced; the closing formula 'Indeed, Allāh is All-Knowing.' is devotional, not a graded citation. GLOBAL-FIRST: a universal structural ruling on bank liability for investment deposits — no market-specific content, no currency figure, no jurisdiction, no AU baseline. The 'capital-protected Islamic deposit' framing describes a product marketed across all four editions rather than privileging one. VERIFICATION: build_res212.py hand-lists every quoted span and verifies each as an exact substring of the official-edition extraction (keyed by block — a span verified against the wrong block would be a fabrication, so the union is never used), runs all three settledness gates, proves the paraphrase gate catches Res 187 while the keyword gate does not, proves both gates catch Res 124, and asserts the Recommendations section is present. audit_res212.py re-extracts every quoted span from the FINISHED JSON on disk and re-verifies it against the source, with a minimal allow-list of the compiler's own words. NEXT candidate for a future run: Res 157 (17/6) on binding mutual commitments and collusion to make contracts (cited by Res 238's Type I ruling) IF still uncovered — verify its 'Resolves' and uncovered status on disk first. Or Res 40 (2/5) on muqāraḍah bonds and investment certificates (the muḍārabah-capital rule Res 212 and Res 238 both lean on) if a distinct, uncovered treatment. RUN ALL THREE SETTLEDNESS GATES, VERIFY 'Resolves' on disk AND confirm not already covered before writing it up. AVOID the whole-subject deferrals already logged (Res 122 (4/13), Res 124 (6/13), Res 187 (2/20), Res 188 (3/20)) and Res 237 (8/24) on electronic currencies.

Topics

bank-guaranteemisinvestmentinvestment-accountsinvestment-depositscapital-guaranteeno-capital-guaranteemudarabahmudaribqiradmuqaradah-bondscurrent-accountsdemand-depositsdeposits-as-loansqardtrusteeshipholding-under-guaranteeholding-under-trusteeshiptransgressionnegligencebreach-of-contractliabilityburden-of-proofcompensationactual-harmopportunity-costunrealized-profitprofit-sharingdonationtabarrudeposits-insurancecooperative-insurancetakafulsupervisory-bodiesarbitrationribaislamic-bankingresolution-86resolution-30resolution-123resolution-200resolution-238resolution-9oic-fiqh-academyiifacollective-ijtihadprimary-textresolution-212

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