Around Thanksgiving and through New Year’s Day, there’s an uptick in donations to charities and nonprofits known as the “giving season.” Giving through an online donation is fast and convenient, but it can also make it easier for criminals to take advantage of your generosity.
Una Osili, associate dean for research and international programs at the Indiana University Lilly Family School of Philanthropy on the Indianapolis campus, has advice on how to protect yourself from fraud and embrace the season of giving.
Do your homework, and be intentional
Having a plan for giving and educating yourself about a charity or nonprofit before you support it is a proactive way to make sure your money is going toward a cause you care about.
Una Osili. Photo courtesy of the Lilly Family School of Philanthropy.
“Charitable giving is a core value,” Osili said. “People are generous and want to make a difference, and the holidays are a time when charitable giving is top of the mind. So, it presents an opportunity to be intentional and have a conversation with your family around what causes you want to support so you can make a difference in a way that is consistent with your values.”
A study from the IU Lilly Family School of Philanthropy shows that while many Americans trust nonprofits and feel that their giving makes a difference, they are concerned about what their money is used for. You can gather information about charities from their website, by visiting a local chapter, or by calling to talk with volunteers and organizers. The Indiana Attorney General’s Office also provides a list of third-party websites that are a helpful resource to find out whether an organization is registered as a 501C3 nonprofit and verify its legitimacy.
Use safe payment methods, and ask for a receipt
“The safest way to donate online is with a credit card, and most credit card companies will re-institute your payment if you are a victim of fraud,” Osili said. “Most reputable charities are going to give you options to pay through check, cash, credit card or PayPal.”
When you donate, reputable organizations will also offer confirmation and a receipt for your payment. A common red flag is a request from an organization that you make your payment only through a wire transfer, which can rarely be refunded if you have been the victim of fraud.
Face-to-face charitable giving scams are less prevalent. So it’s secure to drop cash into a red Salvation Army bucket or join a workplace or school donation effort around the holidays. In those situations, you should still investigate the charity to be sure it is reputable and aligns with your values. You can also ask for a receipt and double check it to be sure the amount you intended to give is what’s reflected on the receipt.
Warning signs of charitable giving fraud include:
Feeling pressured or coerced into giving quickly.
Requests that you pay only with a wire transfer or gift cards.
Failure to provide a receipt, website or other information about the charity upon request.
Suspicious emails where you’re asked to provide confidential information like your Social Security number.
Names and websites similar to popular charities; scammers will try to mimic a reputable charity to fool people into donating to them instead.
Phone calls with caller ID information that doesn’t match the name of the organization.
Promises of high-priced prizes like cars if you donate.