Beware of Charitable Giving Scams
June 14, 2016
Following the tragedy in Orlando, the Ohio Attorney General’s Office offers tips on smart charitable giving.
Attorney General DeWine Offers Charitable Giving Tips Following Orlando Tragedy
(COLUMBUS, Ohio)—Ohio Attorney General Mike DeWine today offered charitable giving tips to Ohioans who want to donate in the wake of the Orlando tragedy.
“Following the tragedy in Orlando, people in Ohio and across the country have shown an outpouring of generosity. They want to know how they can help,” Attorney General DeWine said. “We’re offering charitable giving tips to help people make informed decisions, avoid charity scams, and make sure their donations are used how they want them to be used.”
Tips for making charitable donations after a tragedy:
Carefully evaluate donation requests. Following a national tragedy, some sham charities pop up to take advantage of people’s generosity. Don’t assume that charity recommendations on Facebook, Twitter, or other social media sites have been vetted. The first donation request you find may not be the best.
Evaluate charities using resources such as the Ohio Attorney General’s Office (or another state attorney general’s office), IRS Select Check, Better Business Bureau Wise Giving Alliance, Charity Navigator, and GuideStar.
Beware of “look-alike” websites or accounts. Be skeptical of charities or groups with names that sound similar to well-known organizations. They may be intended to confuse donors. If you receive a message from an organization asking for a donation, confirm that the request truly is from the organization, and not an imposter, by contacting the organization directly or visiting its website.
Be careful when giving to newly formed charities. Some charities that are formed shortly after a tragedy have good intentions but lack the experience to properly handle donors’ contributions. Established charities are more likely to have experience to respond following a tragedy and to have a track record that you can review.
Review claims carefully. Some groups sell merchandise online and claim that “100 percent of the proceeds” will benefit a specific charitable purpose, but this claim does not necessarily mean 100 percent of the sales price will go toward the cause. Contact the organization to ask how much of each purchase will support the cause. If the organization cannot give you an answer, consider donating another way.
Tips for peer-to-peer fundraising or crowdfunding:
Contact a charity before raising money on its behalf. Sometimes individual supporters raise money for charities through peer-to-peer fundraising campaigns, such as by setting up a page on a crowdfunding site. If you want to set up a peer-to-peer fundraising campaign, contact the charity in advance to get permission to use its name and to make sure the representations you make on your page are correct.
Before donating, find out how your contribution will be used. If you want to make a contribution on a peer-to-peer fundraising page, verify that your donation will go directly to the charity versus to the individual supporter.
Check fees. Find out what percentage of your donation will go to the charity, versus the website, and find out whether you will be charged extra fees when you donate.
Tips for giving to an individual or family:
Verify an account. Ask the fundraiser whether there is a trust or deposit account established for the individual’s or family’s benefit. Contact the banking institution to verify the existence of the account, and check locally to confirm.
Do not give cash. Contribute directly to the fund, not to an individual. For example, send a check that is payable to the fund, not to an individual, and mail it directly to the fund.
Understand that your contribution may not be tax deductible. Contributions earmarked for relief of a particular individual or family are not tax deductible, even if they are made to a qualified charitable organization. Before making a donation, ask whether the charitable contribution is tax deductible, and verify your findings with your tax advisor or the IRS. The fact that a charity has a tax identification number does not necessarily mean your contribution is tax deductible. Ask for a receipt showing the amount of the contribution and stating that it is tax deductible.
Respect the family’s requests. If you want to establish a fund to assist victims of a tragedy, be especially careful to respect the wishes of the victim’s family and friends. Obtain written permission to use the names or photographs of any person or organization you want to use in your fundraising appeals. Be specific and transparent about how the funds will be used and how quickly collected funds will be distributed. If there are multiple purposes for the fund, such as funding future community needs, be clear about those purposes. Many donors give with the expectation that all funds will be distributed quickly and solely to victims and their families.
Those who suspect a charity scam or questionable charitable activity should contact the Ohio Attorney General’s Office at www.OhioAttorneyGeneral.gov or 800-282-0515.