Blog Post  Scam Alert: Charitable Giving Fraud

The holiday season brings out the best in people, and that often means making charitable donations.  While we get into the gift giving spirit this month, scammers are finding new ways to take advantage of your generosity through charity scams. This year Massachusetts joined the Federal Trade Commission (FTC), along with agencies from 37 other states to stop a fraudulent telefunding operation that collected more than $110 million from over 65 million consumers.  If you are making a list this year, be sure to check the charities twice before donating any money.

Charity scams ask for donations for fake organizations or organizations that do little to no work, and money collected ends up in the fraudster’s pocket.  These types of scams often occur during the holidays or in the wake of a recent crisis.  This does not mean you should stop your charitable giving, but be ready to spot the scam and donate wisely.

Steps you can take to avoid charity scams:

• Ask for detailed information about the organization soliciting your donation, especially if it is one you are not familiar with. Do your research and give to established charities or groups you know and trust.
• Donate using a credit card if possible. If an unauthorized charge appears on your statement, you can dispute the amount with your credit card company. If the donation is demanded via a wire transfer, cash, virtual currency, or gift card it is likely a scam.
• Carefully review the organization’s name, website, and other supporting materials for inconsistencies or misspellings. Scammers may use names of fake charities that are very similar to well-known reputable entities.
• Take your time and do not let a potential solicitor pressure you to take immediate action. Fraudsters attempt to instill a sense of urgency in order for their target to make a quick uninformed decision to provide personal information.
• Use online tools such as Charity Navigator or the Better Business Bureau’s Giving Alliance to verify an organization before you donate. You can also search the Massachusetts Attorney General’s Office Division of Non-Profit Organizations and Public Charities to search for locally registered public charities.

Don’t ignore the signs of a charity scam this season.  There are many worthy organizations ready to use your donation properly.  If you believe you have encountered a charity scam, report it to the FTC.  Visit the Office of Consumer Affairs and Business Regulation’s website for more information on protecting yourself from charity related fraud.