Giving donations to charities is a great thing to do. There are many charitable organizations that make our world a better place. Unfortunately, wherever people are willing to give, there are unethical people willing to take advantage of them. Some of these charities are just inefficient and spend the majority of their money on overhead, fund-raising, and salaries, and other charities are just plain scams designed to steal your identity.
How to Avoid Charity Scams:
Investigate the charity if you are unfamiliar with it. If you have never heard of the charity, ask for some literature. A legitimate charity will be more than happy to share information about their cause with you. If the charity’s representatives do everything they can to avoid giving you literature, change the subject, or give you an unsatisfactory response, consider donating elsewhere.
Be wary of phone calls soliciting donations. A common method for scamming people is phone call solicitations. While many phone calls may originate from legitimate charities, there are a vast number that are outright scams.
Another thing to be aware of is charities that use phone call solicitations to collect money for firefighters, policemen, and veterans associations. These charities often make an arrangement with a local law enforcement or firefighters group to solicit funds on their behalf, in exchange for permission to make phone calls in the local area and use their name when soliciting funds. Unfortunately, in many of these cases only a small portion of the funds actually go to the respective police or firefighters organization. They claim to “support” a good cause, but usually end up supporting themselves.
Some of these “charitable organizations” have no ties with any of these groups at all, and use misleading organizational names in order to trick people into giving. If it sounds official, it must be official, right? Not always – do your research!
Placing your number on the Do Not Call List can help reduce the number of telemarketer phone calls you receive, but it will not stop registered charities from calling you. You will have to specifically ask them to remove your number after they call you. One other note – once you give money to one of these organizations, they will share your information with others and you will get repeated phone calls from the original group and others!
Think twice before mailing off a check. Mail solicitations are another common means for scamming people. Many “charities” send out personalized address labels, stickers, calendars, or other small items to entice people into giving to them. These are often accompanied with a form that is pre-populated with your personal information and lists “suggested donations.”
Remember, you are not obligated to give anything to them, especially when they send you something unsolicited. And if you give something to them, they will have your information, and you will likely receive many more of these solicitations in the future
Just say no to high pressure sales tactics. Charity organizations will be happy whenever you give them money to goods. If they pressure you to give right now, then they may not be legitimate. You should never be under any pressure to give your money to a charity. If they persist – walk away.
Money Mismanagement. Even legitimate charities may not manage their money well. Before giving money to a charity, try to determine how much of the funds they raise go toward certain costs such as overhead, fundraising and administrative costs and how much of their money goes toward delivering their charitable services. Investigate the charity – if less than 75% of their money goes toward charitable causes, consider donating elsewhere.
Charity Fraud May Lead to ID Theft
Some charity scams are designed not only to take money from you in the short term, but to potentially steal you identity as well. You can monitor your credit reports to look for signs of identity theft using a product like GoFreeCredit.com which will help you monitor account actions related to your name and SSN and help alert you for potential fraudulent activity. GoFreeCredit gives you a 3-bureau credit report and helps you monitor your credit cards, new financial accounts or applications, address changes, and public records. You can start with a 30 day trial.
Protect Yourself and Give Where You Can Make a Difference
Charities are wonderful things and make our world a better place, but you owe it to yourself and others to protect yourself from scams and give money where it will be used properly, and for the right cause.
Note: These solicitation methods are used by both legitimate charities and charitable scams. You should always research any organization before sending them money.
Photo credits, stop stealing: Nisha A, ID theft, stock photo.