What Is a Fake Charity?

When times are tough, the spirit of giving kicks into high gear. Even when facing financial challenges, Americans dig deep to give to those who are less fortunate. However, dishonest scammers can use our generosity to line their own pockets. Untrustworthy people can use fake charities to profit from natural disasters or good causes.

Before giving money to charities, do your research. Make sure it’s an actual charity and not a scam. For more information about charity fraud, talk to a consumer protection attorney.

What Are Types of Fake Charity Scams?

According to the Federal Trade Commission (FTC), imposter scams are the top fraud category, with $2.7 billion in losses. This includes people pretending to be from a bank, law enforcement, or a charitable organization. The FTC received more than 9,800 reports of charitable solicitation fraud in 2023.

There are different types of fake charity scams. With most charity scams, someone pretends to represent a charity to get people to send cash or bank account information. Some scammers try to get your personal information to commit identity theft. These scams don’t involve a real charity; calls can come from anywhere worldwide.

Other fraudsters may go door-to-door soliciting cash donations but keep the money—none goes to the charity. Charity scams can increase around the holiday season or after natural disasters.

Many telemarketing scam charities have very similar names to legitimate charitable organizations. This is to confuse you. It encourages you to send money without asking a lot of questions. Scammers can also spoof phone numbers to make it seem like they’re a legitimate charity.

What Are Signs of a Fake Charity?

It’s hard to know if a phone call or social media post is coming from a legitimate charity or a scammer. Ask questions before you donate. If you think it might be a scam, contact a legitimate charity directly to ensure your charitable contributions go to the right people. Some possible red flags of a bogus charity include:

• Requesting gift cards, cryptocurrency, or wire transfers
• High-pressure tactics to get you to make an immediate donation
• Refusing to give you information about the charity
• Asking you to open an email attachment
• Emails or social media with misspellings or strange language
• Claims that you already pledged, and they’re just collecting money
• Threatening you if you don’t donate

To protect yourself against fake charity scams, go directly to the official website of the charity you want to support. If you paid scammers with a wire transfer, credit card payment, or check, contact your bank immediately. You may be able to stop payment or get your money back. It may be too late if you paid with cryptocurrency or gift cards.

How Can I Find Out if a Charity Is Legitimate?

Many legitimate charitable groups are doing good work for people, animals, and the environment. If you get an unsolicited phone call asking for a charitable donation—start asking questions. If you like the pitch, request that the caller send you more information. A legitimate charity will be able to tell you more about its mission and its work.

Get the official name so you can look up the charity. You can also look up information about the charity’s name to find out more about what it does and how it works. The Better Business Bureau’s Wise Giving Alliance (give.org) has information about charity programs, finances, and fundraising methods. CharityWatch.org and CharityNavigator.org are other charity rating organizations.

Can I Get a Tax Deduction for Donations?

Most taxpayers can get a tax deduction for charitable contributions. However, the donations have to go to a qualifying organization. You can check with the Internal Revenue Service (IRS) to see if an organization is eligible to receive tax-deductible charitable contributions. The IRS has a tax-exempt organization search tool on its website.

How Can I Report a Fake Charity?

If you get a donation request from a fraudulent charity, report it. This will help make it easier for law enforcement to stop scammers and prevent others from getting ripped off. You can report fake charities to the FTC at ReportFraud.ftc.org. You can also report fraud to your state attorney general’s office. For more information about what you can do as a victim of charity fraud, contact a consumer protection attorney.