Bankruptcy

Protect Your Money: Avoid Charity Scams

By guest-writer

The recent earthquake and tsunami in Japan have left many people in the United States eager to offer financial aid to the country and its citizens. But, as the Federal Trade Commission warns, it?s easy to get duped by unscrupulous scammers posing as charitable organizations.

Here?s a look at some of the FTC?s tips for making sure your money actually goes to people in need.

What to Look for in a Charity

According to the FTC, it?s important to take these steps before donating to any charity online, in person, over the phone or via postal mail:

• Ask for the name of the charity, particularly if the solicitor does not immediately provide it. Check online to see whether the charity has a legitimate web site, Better Business Bureau accreditation and/or any consumer complaints posted on discussion forums.
• Ask what percentage of your money will go towards charitable causes. If the solicitor cannot answer the question or is cagey, this is a warning sign. You have a right to know where your money is going, and if you think too little is slated for the actual cause, simply refuse a donation and find another charity with better donation policies (web sites like the BBB?s Wise Giving page and Charity Navigator can offer you alternatives).
• Check with the charity that the solicitor is legitimate. In some cases, scam artists might pose as charity workers with a legitimate organization. If you?re uncomfortable giving money or a check to a person you don?t know, call the charity to verify any information you?ve been given. You can also choose to donate directly to the charity online or through the mail.
• Don?t part with your sensitive information. Nobody should pressure you into revealing your credit card or bank account information. Wait until you?ve made a decision in your own time and only provide such information on secure web sites. This can help you avoid raising your risk of identity theft.
• Ask for a receipt. Any time you make a donation to a legitimate charity, you should get a receipt indicating that the donation is tax-deductible.
• Be wary of pushiness. Any person or group that urges you to donate immediately should be viewed with suspicion. Legitimate organizations will still be around tomorrow, after you?ve had time to consider your finances and determine how much money you can afford to donate.
• Don?t use cash. For a number of reasons, cash donations tend to be the riskiest in the case of charity groups. Instead, write a check to the charitable organization (not to the person collecting donations).

Remember: nobody should use guilt or threats to convince you to donate money. If you don?t like the way a solicitor is making you feel, simply cut off communication with that person and (if necessary) file a complaint with the FTC. You can then donate as much or as little money as you choose to the charity of your choice.

Full post as published by The Bankruptcy Blog on March 21, 2011 (boomark / email).