Giving Wisely in the Wake of Disaster

It seems lately that with each new day comes a new disaster. Hurricanes, tsunamis, mass shootings, rampant wildfires…the list goes on. We want to help, to give back in some tangible way, to try and make a difference. Unfortunately, while we are looking for the best ways to help, scammers are looking to take advantage of our giving nature for their personal financial gain. Here are some things to look for to stay ahead of fraudsters.

Social media scams
As soon as the latest tragic event blazes across your newsfeed, scams pop up right behind it. In fact, social media is now some of the most fertile ground for scammers, says David Borochoff, president of CharityWatch, an organization that monitors nonprofit groups. Most common are fake Facebook pages dedicated to certain causes, posts with links to imposter websites designed to steal your account information, or websites and blogs with heart wrenching—and false—stories about “suffering” victims.  Sometimes, scammers may use real victims’ pictures and stories to scam you out of money.

Crowdfunding sites
One of the newest ways scammers are going after your donations is through crowdfunding campaigns. With these campaigns, people create pages on crowdfunding sites like Kickstarter or GoFundMe to raise money for personal causes, or for large bills like medical costs. Unlike public charities that are required to disclose their finances annually to the IRS, Borochoff says, someone with a crowdfunding campaign isn’t required to disclose how they use the raised funds.

As a result, while many crowdfunding campaigns are legitimate, some can be fertile ground for potential scams. It’s best to only give to individuals you know personally, or those who you know are in real need, Borochoff cautions. Plus, he adds that even if the person is a legitimate victim of a disaster, like Hurricane Harvey, for instance, he or she may have already raised a lot of money or may be entitled to insurance money or victims’ compensation funds and are now just being greedy.

As opposed to crowdfunding campaigns, Borochoff recommends giving through a reputable, well-known nonprofit organization whose caseworkers can determine if an individual really does need the assistance.

Protect yourself
Before giving to any charity—whether in response to a disaster or year-round—it’s important to do your due diligence to avoid getting scammed. Here are some tips from the IRS and the Federal Trade Commission to help make sure your donation dollars are going to the right place.

Do some investigating. Start with a search on watchdog websites like Charity NavigatorGuideStar and the Better Business Bureau’s Wise Giving Alliance. It’s also recommended that you go to the IRS website to see if a charity is registered. Stick to well-known, recognized charities. Also know that any organization which has been approved by the IRS as a tax-exempt charity will not have a “.com” or “.biz” domain address; it will have an “.org” domain.

Beware of imposters. Often phony charities will use names or websites that sound or look like respected, legitimate organizations. Google the charity’s name and see if any scams pop up. Avoid charities that seem to have sprung up overnight in connection with recent current events.

Be careful what you share. Never give or send cash. For security and tax recording purposes, you should donate by check or credit card so you have a record of the donation. Don’t give out your Social Security number, or financial account information and passwords to anyone. That information is not necessary to make a donation to a legitimate charity.

When in doubt, delete. If you get a suspicious solicitation e-mail or text, delete it and don’t click on links or open attachments. You could unknowingly install malware on your device or be directed to a fake charity website.  Look up the charity’s URL and type it in to your browser.  If you receive a text, confirm the number on the charity’s website.

Take advantage of available resources
The IRS offers a free booklet on its website, which gives the tax rules that apply to making legitimate tax-deductible donations and also provides complete details on what records to keep. And if you or someone you know is impacted by a disaster, details on available relief efforts can be found on the IRS’ disaster relief page.

Resources: Wall Street Journal, Internal Revenue Service, Federal Trade Commission