Scammers often pose as charities and solicit donations for emotional causes such as children with life-threatening disease, wounded veterans, police and firefighters, natural disasters, etc. In many instances they use a name similar to a legitimate charity to mislead donors, e.g., “American Cancer Research Society” instead of the American Cancer Society. They are also more aggressive than legitimate charities, often calling you at home or coming to your door. Keep in mind that legitimate charities, in contrast to scams, will not pressure you to donate on the spot. The following tips will help protect you from these scams.
- Check out any suspicious “charities” on the California Attorney General’s or BBB’s websites at www.ag.ca.gov/charities or www.bbb.org/us/charity, respectively. Both have searchable databases that provide information on legitimate charities.
- You can also go to www.CharityNavigator.org for the following information on specific charities: fund-raising efficiency rate, program/administrative spending ratios, revenue/expense statements, salaries of top administrators, and an overall rating. Most reputable charities will spend about 75 percent of their funds on their programs. Another source of information is www.GuideStar.org.
- Check the charity’s IRS Form 990. By law non-profit organizations must make these tax forms available to the public for the last three years. They touch on everything from management policy and executive pay to conflicts of interest. And they will tell you whether the charity is financially secure. These forms can also be seen on www.GuideStar.org.
- Never donate over the phone. Even if the charity is legitimate, most of the money will go to the telemarketing company making the call. If you want to contribute, do so directly to the charity.
- Do not respond to any solicitations by e-mail. Many are fraudulent and contain viruses.
- Donate by check or credit card, never with cash.