FRAUD RESOURCE CENTER
En español | Americans contributed more than $471 billion to charity in 2020, according to the Giving USA Foundation’s annual report on U.S. philanthropy. That generosity supports many amazing organizations that put those billions to work for health care, education, environmental protection, the arts and numerous other causes.
Unfortunately, it also opens a door for scammers, who capitalize on donors’ goodwill to line their pockets.
Many such frauds involve faux fundraising for veterans and disaster relief. Scammers know how readily we open our hearts and wallets to those who served and those rebuilding their lives after hurricanes, earthquakes or wildfires. Charity scammers are especially active during the holidays, the biggest giving season of the year.
Sham charities succeed by mimicking the real thing. Like genuine nonprofits, they reach you via telemarketing, direct mail, email and door-to-door solicitations. They create well-designed websites with deceptive names. (Cybersecurity firm DomainTools noted a huge jump in URL registrations with the words "Ukraine" and "Ukrainian" in the days after Russia's invasion.)
Some operate fully outside the law; others are in fact registered nonprofits but devote little of the money they raise to the programs they promote. Federal and state authorities who shut down a massive fundraising network in March 2021 said the affiliated companies pocketed as much as 90 cents on the donated dollar as they bombarded consumers with illegal robocalls and deceptive appeals to support homeless veterans, cancer patients and autistic kids.
With a little research and a few precautions, you can help ensure your donations go to organizations that are genuinely serving others, not helping themselves.
- Pressure to give right now. A legitimate charity will welcome your donation whenever you choose to make it.
- A thank-you for a donation you don’t recall making. Making you think you’ve already given to the cause is a common trick unscrupulous fundraisers use to lower your resistance.
- A request for payment by cash, gift card or wire transfer. Those are scammers' favored payment methods because the money is difficult to trace.
- Do check how watchdogs like Charity Navigator, CharityWatch and the Better Business Bureau's Wise Giving Alliance rate an organization before you make a donation, and contact your state’s charity regulator to verify that the organization is registered to raise money there.
- Do your own research online. The Federal Trade Commission (FTC) recommends searching for a charity’s name or a cause you want to support (like “animal welfare” or “homeless kids”) with terms such as “highly rated charity,” “complaints” and “scam.”
- Do pay attention to the charity’s name and web address. Scammers often mimic the names of familiar, trusted organizations to fool donors.
- Do ask how much of your donation goes to overhead and fundraising. One rule of thumb, used by Wise Giving Alliance, is that at least 65 percent of a charity’s total expenses should go directly to serving its mission.
- Do keep a record of your donations and regularly review your credit card account to make sure you weren’t charged more than you agreed to give or unknowingly signed up for a recurring donation.
- Don’t give personal and financial information like your Social Security number, date of birth or bank account number to anyone soliciting a donation. Scammers use that data to steal money and identities.
- Don’t make a donation in cash or by gift card, cryptocurrency or wire transfer. Credit cards and checks are safer.
- Don't click on links in unsolicited email, Facebook or Twitter fundraising messages; they can unleash malware.
- Don’t donate by text without confirming the number on the charity’s official website.
- Don’t assume pleas for help on social media or on crowdfunding sites such as GoFundMe are legitimate, especially in the wake of disasters. The FTC warns that fraudsters use real victims’ stories and pictures to con people.
- The Internal Revenue Service maintains an online database where you can check whether an organization is a registered charity and if your donation will be tax-deductible.
- You can report suspected charity frauds to the FTC and the government agency in your state that regulates charities.
- The BBB Wise Giving Alliance, Charity Navigator, CharityWatch and GuideStar provide a bevy of resources on charitable organizations, including ratings, reviews, and tax and financial data.
Updated March 24, 2022
About the Fraud Watch Network
Whether you have been personally affected by scams or fraud or are interested in learning more, the AARP Fraud Watch Network advocates on your behalf and equips you with the knowledge you need to feel more informed and confidently spot and avoid scams.
More From the Fraud Resource Center