At first glance, this seems like a simple question. If an organisation harms people, why does it receive charitable status and the tax concessions that come with it?

The obvious answer is failure of enforcement. But that does not quite fit the evidence.

Since its establishment in 2012, the Australian Charities and Not-for-profits Commission has revoked hundreds of charities. Almost all were deregistered for administrative non-compliance, such as failing to lodge reports or meet governance standards. In a small number of cases involving fraud or terrorism financing, the Commission has acted decisively.

What this suggests is not regulatory indifference, but regulatory limits.

The ACNC was modelled on the UK Charity Commission, where charity regulation evolved partly in response to public concern about cults and extremist groups operating under the banner of religion. Australia imported the regulatory structure, but not the surrounding policy context. Here, debate focused almost entirely on efficiency, accountability, and transparency. Questions of coercion or everyday harm remained largely peripheral.

As a result, the ACNC is not designed to assess whether an organisation’s routine conduct is psychologically coercive or abusive. It has no legal test that reliably distinguishes public benefit from patterns such as enforced dependency, family estrangement, or coercive financial demands.

Parliament anticipated this problem more than a decade ago. In 2010, the Senate Economics Legislation Committee reviewed the proposed public benefit test and noted strong community concern about cult-like organisations and the harms they were causing. Australian Treasury’s 2011 consultation was explicit: evidence of harm should weigh against charitable status, and organisations causing significant harm should lose registration.

But without a legal definition of group-based coercive control, harm remains difficult to characterise in a way regulators can act on. The conduct is cumulative, patterned, and often obscured by spiritual or organisational narratives. It rarely presents as a single, discrete breach.

This is where state-based group-based coercive control laws matter.

Such laws would not regulate belief. They would regulate behaviour. And they would create something the ACNC currently lacks: a clear external finding that unlawful, harmful conduct has occurred.

With that legal fact in place, the Commission could act as it already does in cases of fraud or terrorism financing. The issue is not whether the ACNC should regulate cultic harm. It is that, without a workable legal framework, it cannot.