Think Before You Give

Charity Scams Are On the Rise

There are millions of Americans who are financially struggling due to the fallout of COVID-19. Many of us want to help, and donating to a charity is a great way to do so. Unfortunately, fraudsters know this as well. Scammers are using the pandemic’s hardships and the vulnerable emotional state of the population to pose as charities and defraud people to take their money.

How It Begins

Fake charity scams might pretend to be representatives of a legitimate charity. They'll call you, email you, or approach you on the street for donations. When you give, it’s likely your money will end up in the scammers’ pockets and not with the charity you were hoping to support.

Once you give, you become a scammer’s target. They will likely request more donations from you, and you could give multiple times without knowing your money isn’t going to where you believed it was.

Other scammers will make up their own charity names. They might set up fake websites that look much like the sites run by legitimate charitable organizations. Some have even claimed to be a struggling business you might know and love. Claiming hardship, they’ll have set up a GoFundMe account for you to give to. The goal, again, is to get you to make a donation not to a real charity, but to them.

Fake charity scams can be lucrative because so many people do want to support legitimate charities. According to Giving USA, U.S. residents donated $427.71 billion to charities in 2018. That's a lot of giving, which makes charity scams especially attractive to scammers.

They Can Also Steal Your Identity

Those running charity scams don't only go for your money, either. Some scammers will ask you to provide personal or financial information such as your Social Security number, bank account information, or credit card numbers.

Armed with this information, these criminals can make fraudulent purchases with your credit card, tap your bank accounts, or take out loans in your name.

It's important, then, to be alert when asked to donate money to charity. Making sure that the charity reaching out to you is legitimate is one of the best ways to protect yourself from criminals.

Nine Tips to Avoid Charity Scams

1. Research, Research, Research
   Before you give to any charity, do the research necessary to verify that the organization is legitimate. A good place to start is by checking the lists run by watchdog groups such as CharityWatch, CharityNavigator, and the Wise Giving Alliance run by the Better Business Bureau.
   
   Seek out the charity’s website to validate their work. During and after disasters like COVID-19, individuals are likely to set up fake websites claiming to be a charity. Make sure you can find the nonprofit’s EIN somewhere on their website or donation page to know that the money is going to the right place. Most nonprofits also have .org website rather than .com’s.
   
   Are they a registered public 501(c)(3) organization? Of course, this is no guarantee that they are not a scam, but fly-by-nights don’t file legit reports (called Form 990s) with the IRS. Ask for one. If they hem and haw, move on.
   
   You can also check your individual state's charity regulator to verify that a charitable organization you are considering donating to is allowed to raise money in your state.
   
   Again, if they’re claiming to be a business with a GoFundMe page, contact the business directly to validate the claim and ensure you have the correct link to their donation page.
   
   
2. Add key search terms
   The Federal Trade Commission recommends that you search online to help narrow down whether a charity is legitimate.
   
   Say a charity contacts you seeking relief for homeless children. Type into your favorite search engine the charity name you've been given plus words such as "complaints," "review" or "scam."
   
   If you find many complaints or charges that the "charity" that has reached out to you is a scam, it's wise to avoid giving it any of your dollars.
   
   
3. Look for warning signs
   AARP says that there are several warning signs of a fake charity. If someone calls you on the phone and pressures you to give money immediately, that's a good sign that the "charity" you are dealing with likely isn't legit. Real charities won't pressure you to give immediately. They'll take your dollars whenever you are ready to give them.
   
   
4. Watch for payment methods
   Be wary, too, if a representative from a charitable organization asks you to pay by wire transfer, cash, or through a gift card.
   
   AARP says that these are the most common payment methods requested by scammers. Why? Because these payment methods are more difficult to trace.
   
   
5. Beware of bogus thank-you emails
   Be suspicious, too, of emailed thank-you letters from charities you don't remember supporting in the past. Scammers often try to trick you into giving by convincing you that you have supported their fraudulent organizations in the past.
   
   
6. Take caution with emails
   Charity Navigator recommends that you be especially cautious when dealing with emails from charitable organizations. Email is the preferred method of communication by many scammers, and Charity Navigator says that fraudsters are often skilled at creating websites and email messages that mimic those of legitimate charities.
   
   
7. Consider donating directly
   Charity Navigator says that you should never give money to a charity just because they sent you an email. If you do want to give, contact a charity directly to learn more about its needs and where it is sending donations.
   
   
8. Guard your personal information
   Never provide anyone saying they are from a charity with your financial information. Legitimate charities won't ask for your bank account information or credit card numbers by phone or through email. And be suspicious of charities that ask you wire money overseas, too. Charity Navigator says that this is a common scam.
   
   
9. Delete emails with attachments
   Charity Navigator says that you should immediately delete emails supposedly from charities that contain attachments. These attachments often contain viruses and malware that can infect your computer.
   
   

Stay Alert, Even In Times of Crisis

In times of a crisis, people have an increased desire to want to help by giving. Remember, your desire to give is important, but it’s even more important to be alert.

To avoid becoming a victim, do your research before giving to any charity and be on the lookout for some of these red flags of fraud. And when you want to give, consider donating directly for peace of mind.