Fraud vs. Fact: Knowing the Differences Between Real and Fake Charities
Along with holiday cards and calls from family members and friends during the holidays, mailboxes, email inboxes and voicemails are bombarded with the messages from charities asking for money to support their cause. While some of these may be legitimate (Red Cross, Salvation Army, etc.), scammers often take advantage of the giving spirit of winter, using charities to fraudulently earn money and even to steal people’s identities.
Whether you are visited by a door-to-door supposed supporter, asked outside your local grocery store, emailed or called, take a proactive approach to donating by doing research to protect yourself. Do not give any potential scammer the opportunity to take advantage of you. You are not obligated to return messages, read emails or have conversations with people that you do not want to. Identity theft protection is fiercely important not only during the gift giving season, but for all seasons. Staying up-to-date on the latest protection and tips, like on Lifelock’s Twitter page, will help keep your personal and sensitive information locked down.
How to Tell?
Start by asking for the charity’s name, address and phone number; the truth is in the details. Ask the person if they are a professional fundraiser and what percentage of costs will actually be going to the fund. If any person pressures you see it as a red flag as well as anyone asking for cash donations or offering a collateral for gifts for donating. Some scammers will try to mock well known charity uniforms and logos, do not be fooled. Do some research on the organization, look up state-wide locations and officials on the National Association of State Charity Officials website.
The Right Status
It’s smart to only support organizations granted tax-exempt status under section 501(c) (3) of the Internal Revenue Code. The IRS grants tax-exempt status under this code, under this groups are required to meet a specific criteria one major factor being that in order for the charitable organization to be able to receive donations it must not work in favor of private interests. legitimate organizations will be granted this. Do not donate to groups whose status is still processing or declined as your money is not guaranteed to go where you want it to go.
Research the Company
Research how charities determine their CEO’s salary. According to Charity Navigator “the most efficient charities spend 75% or more of their budget on their programs and services and less than 25% on fundraising and administrative fees.” Another important aspect of organization life to look into is the groups consistency and ability to withhold long-term projects and growth. being able to sustain these two things shows security. While researching, it’s important to take the company’s transparency and willingness to divulge information to the public. If you are committed to change in your cause, research the actual impact an organization has made in research, government and social policy. Is this organization worth putting your money towards?
Author: William Hernandez After covering his local school districts for his community newspaper for five years, Will launched his own freelance business where he writes about education, community and social topics.
photo credit: EricGjerde via photopin cc