Scamming the Generous
And it is to America that the world returned that giving in gratitude. Saudi Arabia, Venezuela, France, England, China, Russia, Germany. Some are adversaries. Some hold differences of opinion on American foreign policy. Some of those countries may even have good reason to dislike us. But when we were hurt, they responded with an outflow of prayer, and promises of support.
But the biggest helping hand is here at home, the people of America. You and me, among 200 million others.
The tsunami response from the American Red Cross had its total cost covered in 35 days of donations. So much money was collected for the victims of 9/11 that some of the organizations had to rethink their plans to ensure it was well-spent and not wasted in some oddity of gluttony or dollar-sign sickness. Enemy groups may charge Americans with being many things, but no one has ever faulted our generosity when another person hurts.
But this generosity has spawned a new type of predator. Scam artists have long tried to sell us impossible things (i.e. the Brooklyn Bridge) or things we don’t need (i.e. water hydration systems), but this is a new breed. A breed of dark-hearted greedy bottom-dwellers that prey upon those who only wish to help.
The Scams
E-mail traffic soliciting donations for the victims of disasters has rarely been legitimate, and is usually detected by spam fighters, but no one knows how many of the recipients are tricked into giving up their money, credit card numbers, bank information, you name it. The same thing goes for Internet sites that appeal for cash donations, providing “convenient” means of donating to multiple agencies at the same time. Some of these “multi-fund” organizations actually transmit the donations to the right locations, albeit with a hefty fee (up to 50% in many cases) deducted as “operational expense.” Many, however, simply take the money and disappear.
The Better Business Bureau has estimated in the past that as much as one-sixth of all donations are actually made to fraudulent organizations. Recent abuse of web addresses has caused the W3C and several major ISP’s to review new donation sites and they have, in some cases, shut down the sites due to signs of flagrant fraud. The IRS is frequently overwhelmed by requests for 501(c)(3) status verification, so much so that in the two days following Katrina, the web servers for the verification clearinghouse overloaded and went offline six times.
Counting The Cost
Wisdom may come too late, and could cost you in other ways. If the organization is not a registered charity, with a 501(c)(3) designation from the Internal Revenue Service, donations to that organization are not tax deductible, which could end up costing you extra around April 15. And many of the fake organizations will not offer a receipt for tax purposes; although every legitimate charity will, and will produce a copy of their 501(c)(3) designation letter on demand. A small fee (generally not more than $10) may be charged if you want a photocopy of the letter. Lacking a receipt, you may have a hard time proving to the inquisitive IRS agent that your donation was made in good faith.
Money sidetracked into fake charities can move to a number of organizations which quite frankly do not deserve your (or anyone’s) support. Terror organizations have long used the power of offshore accounts and blind transfers to move money; the advent of the Internet merely expanded this trafficking. While no hard numbers are available on how much of the diverted donations are being acquired by terror organizations or their fronts companies, the risk is very real. And donations to the wrong company, even unknowingly, could set you up for a very poor encounter with the local federal agents.
How to Avoid the Scams
If you don’t have time to sort out the real from the fake, stick with the ones you know. The big ones are the American Red Cross, Habitat for Humanity, America’s Second Harvest and the outreach ministries of half-a-dozen world church organizations. A partial listing for charities actively involved in helping at a disaster can be found at the Federal Emergency Management Agency website (http://www.fema.gov). Another wonderful place to go looking for help is at the charity-investigation arm of the Better Business Bureau (http://www.give.com). Make sure that the organization is real, has a verified mission in disaster relief, and is a known and trusted guardian of the donated dollar. Do not be afraid to ask for proof of the 501(c)(3) status from the organization. And above all, make sure that you get your receipt.
America is open-handed when it comes to disaster relief. Don’t let a grinch steal your donation.
