Answered by Shaykh Faraz Rabbani
Question: Is it sinful to enter into corrupt contracts?
Answer: In the Name of Allah Most Merciful & Compassionate
The `ulama’ have clearly stated that entering into corrupt contracts is sinful, as it is going against the Divine Command to make one’s dealings on the basis of mutual agreement. [Qur’an, 4.24]
Ibn Abidin mentions that:
“It is a contract contrary to the religion, as was explained in [Ibn al-Humam’s] Fath. It will be coming that it is a sin that is necessary to lift. And it will be coming in the Chapter on Riba that, ‘Every corrupt contract is akin to riba,’ that is, if its corruption is due to a corrupt stipulation.” [Radd al-Muhtar, 4.111, Bulaq ed.]
Imam Kasani says in Bada’i al-Sana’i`,
“Entering into a corrupt contract (al-`aqd al-fasid) is sinful.”
The same was affirmed before him by Imam Sarakhsi in al-Mabsut.
And Allah alone gives success.
(Originally answered on the SeekersGuidance Academy’s Islamic Law for Seekers: Transactions Course Forum)