Making sure your gift goes where you want it to go

Avoiding Charity Scams

by Joanne Guidoccio

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Without charities and other non-profit organizations, many vital services would not be available in the United States. The 2014 numbers from the "Giving USA " report are both encouraging and mind boggling.

  • Americans gave $335.17 in charitable donations, an increase of four percent from 2013.
  • Giving by corporation declined almost 2 percent, which means their was a major upswing in individual donations.

As these tax-exempt organizations continue to increase in number, competition for funds will become more competitive and mailboxes will fill up with even more fund-raising appeals. While most of these charities are legitimate, unfortunately, a small minority are not. If you are not careful, you may find yourself funding an organization's administrative costs or lining the pockets of scam artists instead of supporting a worthy cause. Before making a donation, consider the following tips:

Get Off the Telephone

No reputable charity will ask you to donate over the telephone. If you receive such a call, simply request written literature and a copy of the charity's latest report. This should include a list of the board of directors, a mission statement, and the most recent financial reports. Check the organization against such consumer watchdog groups as the Better Business Bureau Wise Giving Alliance, American Institute of Philanthropy and Charity Navigator.

Check the Numbers

No more than forty percent of donations should be used to cover general administration and fund-raising costs. If the organization is new, this percentage may be slightly higher. Be wary of charities that use the label "public education" to hide large portions of their direct mail and telemarketing expenses.

Do Not Respond to Pressure

You have a right to say no. Do not allow an aggressive caller to pressure you into sending a check and possibly exposing yourself to identity fraud. Hang up immediately if the caller persists. Also, keep in mind that you are not obligated to make a contribution to keep greeting cards, address stickers, calendars, key rings, and other "gifts" sent in the mail. It is against the law for a charity to demand payment for any unordered merchandise.

Be extra vigilant around the holiday season, especially if you have elderly relatives and friends. Scam artists often target older people who live alone and have few social supports. Share your concerns with these seniors and encourage them to hang up on any suspicious callers.

Double-Check the Name

Some charities use names that closely resemble well-known, legitimate organizations. Con artists can easily impersonate a reputable charity, sending e-mails with a well-known logo with a link that directs donors to a different website. If the name sounds suspicious, check with your state charity registration office before making a contribution.

Do not automatically donate to charities that spring up immediately after a natural disaster. While they may use the name of the disaster in their logo, these flight-by-night organizations do not have the infrastructure to get the donations to the affected areas. If you wish to help in such situations, contact the American Red Cross.

Keep Records

While it is necessary to save records of any donations for tax purposes, it is also important to keep records to avoid fraud. Whenever possible, give using a check or money order instead of cash. If you wish to give online, ensure that the site is secure. Check for the lock icon on the status bar or a website address that begins with "https"; the "s" indicates that the site is secure.

Be aware of the difference between "tax exempt" and "tax deductible." "Tax exempt" means the organization does not have to pay taxes while "tax deductible" means you can deduct contributions to the charity on your federal tax return.

Give Generously and Wisely

Once you have identified worthy charities and causes, consider your own budgetary constraints. Decide whether it is better to give small amounts to a number of charities or focus on one charity per year.

Updated November 2014

For 31 years, Joanne Guidoccio taught mathematics, computer science, business and career education courses in secondary schools throughout Ontario. Her articles, book reviews, and short stories have been published in newspapers, magazines, and online. She has bachelor's degrees in mathematics and education and a Career Development Practitioner diploma. Visit her website at

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