What is the ruling on profits gained from a public trading company if it engages in unlawful activities without the shareholder's knowledge, given that the contract stipulates operating according to Islamic Sharia and the manager has affirmed this?
The described transaction is a Mudarabah (profit-sharing partnership). For it to be permissible, the profit must be specified as a common percentage (such as one-third or one-fourth), and the agent (Mudarib) should not be held liable for losses. If this condition is not met, or if the agent is guaranteed against loss, then the Mudarabah is invalid, and the profit belongs to the capital provider, while the agent receives a customary wage (Ujrat al-Mithl). There is no sin upon you if the company engaged in impermissible activities without your knowledge, after you stipulated that it operate according to Sharia. However, if you become aware of it, you must prohibit it and withdraw your funds if it does not cease. You must also purify the profit corresponding to the impermissible transactions by spending it on charitable causes with the intention of disposing of unlawful gains.
Summarized from the full answer at Ftawy · reviewed Sep 2, 2026
Read the full answer on Ftawyhttps://ftawy.com/en/questions/91721