Charitable giving continues to grow year over year, and the majority is from individuals. In 2017, 70% of American donations came from individuals, up 5.2% from 2016. In Canada, donations continue to rise every year, with the baby boomer generation being responsible for more than 40% of total donations. But with everything nowadays you need to beware of scammers who will try to take advantage of these good intentions, and pocket your donations instead of distributing them to a greater need.
In this article we take a look at past donation scams, 6 ways to make sure you’re donating to a legitimate charity and what to do if you think you’ve been scammed.
What are some past donation scams we can learn from?
1. Natural Disasters – when massive natural disasters happen they bring out the best in many of us. This type of donating is called ‘disaster giving’ and scammers are often ready to take advantage of it.
- In 2005, Hurricane Katrina wrecked the city of New Orleans and the surrounding areas and scammers were quick to jump on the opportunity.
- he American Red Cross asked the FBI to investigate at least 15 fake websites designed to mimic the official Red Cross website and ask for donations.
- The FBI created a department, the National Center for Disaster Fraud, to prevent future scammers from capitalizing on other’s misfortune.
- However in 2012 we saw a charity call themselves the Hurricane Sandy Relief Effort and raise $600k for storm victims when in reality the scammers pocketed the money. This is just one example, over 150 people were charged after Hurricane Sandy when nearly $20 million was raised by fraudsters.
2. Crowdfunding websites – GoFundMe is a great platform used to crowd source money for different charities, but you always need to be careful.
- Recently a GoFundMe scam raised over $400k for a homeless man.
- here have also been cases of people faking injuries or diseases to get raise money for themselves.
- Here is how to determine if a GoFundMe is safe to donate to and here is how to report a campaign on GoFundMe.
3. Some charities are legitimate but do not use money wisely.
- Givewell and Charity Navigator rate charities based on their transparency, financial status, and how well they execute their altruistic missions.
6 ways to make sure you’re donating to a legitimate charity
1. Approach the charities yourself – vet them online and offline before you give and always be on the look out for phishing emails.
2. Check their registration– all charities should be registered with their state of residence – here are lists of registered charities in the US and Canada. You can also check if the organization is listed with the Better Business Bureau at Give.org, or the Canadian Charity Registration Portal.
3. Review their website – make sure it’s secure by looking for “https.”
4. Give directly – make sure to avoid third-party givers as they will take a slice of your donation and the charity will receive less.
5. Know what to give – a charity will never need your Social Security Number or birth date for you to make a donation.
6. Look for a receipt – the receipt will have the charity’s details included on it so you have the option of claiming it on your taxes.
What to do if you think you’ve been scammed
If you think you’ve been scammed make sure to alert the authorities. Report to either the authority of the platform you found the charity on (like Facebook) or authorities monitoring fraud in your state or country. Click here for the US cyber fraud reporting portal.
Always be careful who you give to! Comment below with the charities you like to support and be sure to like our Facebook page for daily updates.