As the holidays approach, people start thinking about making charitable donations. But take care with those well-meaning plans. Each year, crooks use scams to cheat people and to steal millions of dollars intended for charities.
The problem is that these scams are hard to identify. For example, the Federal Trade Commission in May filed a lawsuit against the Cancer Fund of America, the Children’s Cancer Fund of America and the Breast Cancer Society.
These charities, which have existed for years, have raised more than $200 million, yet only about 3 percent of their money went to cancer patients, research or treatment, according to the FTC. The trouble is that when someone gets a phone call from an organization such as the Children’s Cancer Fund of America, it sounds legitimate and well-meaning, so people donate money.
DOORSTEP SCAMS
Some scams are closer to home. A few years ago, a teenager along with an older gentleman, asked local business owners to contribute to a Muscular Dystrophy Association bike ride. In exchange, donors were promised discounted Cedar Point season passes. Instead, the scammers pocketed the cash.
This is a big problem with a solution. Look at the FTC and Ohio Attorney General websites to help identify scams targeting people who want to donate to charities. For example, the FTC recently issued a warning about charity scams in connection with recent floods in Louisiana.
SO WHAT SHOULD YOU DO IF YOU WANT TO CONTRIBUTE TO CHARITY?
Here are five steps to take to make sure your money goes to the charity you want
1 Research the Charity.
If you are not familiar with the charity you can research it on the FTC website, consumer .ftc.gov. You can also research on the Ohio Attorney General’s website, ohioattorneygeneral.gov, to find charities registered in the state.These websites have links to organizations such as Charity Navigator, Charity Watch and Guide Star, which provide valuable information about charities, including how much they spend on charitable activity versus payroll and other overhead. Another place to research is the Better Business Bureau Wise Giving Alliance. The website is give.org.
2 Ask for written information.
A legitimate charity will send information about the charity in the mail if it’s requested.
3 Ask who is calling.
Ask whether the caller is a fundraiser or a volunteer and what percentage of the money raised by the solicitor goes to the charity. Some legitimate charities have professional fundraisers that wind up with 70 percent or more of the contributions. You may decide that you want to give to the charity but not through phone solicitation.
4 Don’t provide credit card or bank information.
Avoid cash gifts — checks are better, made payable to the organization, not an individual.
5 Consider designating a specific disaster or charitable fund.
That will ensure your gift goes to an actual disaster or charitable purposes, not to the general fund. The old phrase “No good deed goes unpunished” sometimes is true. Don’t give away your money for a good reason to the wrong person. Take the time to make sure your hard-earned money goes to a real charity and not into a scammer’s back pocket.
