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7 Signs of a Charity Scam

nepal charity

The massive earthquake in Nepal and the Katmandu Valley area that is responsible for over 4,600 deaths has left devastation in its wake. As with any disaster, there are many caring individuals that want to offer support. On the flip side, there are scammers looking to cash in on the tragedy.

Business Consumer Alliance (“BCA”) urges individuals to avoid blindly donating to organizations claiming to aid those in need. Be wary of charities or organizations that spring up suddenly in response to current events and natural disasters. Even if they are legitimate, they may not have the infrastructure in place to get the donations to the affected area or people. It’s important to research an organization or charitable cause to make sure your donation is used as promised.

The following seven signs should help you spot an untrustworthy charity or fundraiser:

  • Refuses to provide detailed information about who they are, their mission, costs, and how the donation will be used.
  • Won't provide proof that a contribution is tax-deductible.
  • Uses a name that closely resembles that of a popular and reputable organization.
  • Pressures you to donate immediately, without giving you time to think about it or conduct research.
  • Asks for cash donations or asks you to wire money.
  • Offers to send a courier or overnight delivery service to collect the donation immediately.
  • Guarantees sweepstakes winnings in exchange for a contribution. By law, you never have to give a donation to be eligible to win a sweepstakes.

Before donating, consider these tips:

  • Ask for detailed information about the charity, including name, address, and telephone number.
  • Use the information you have to obtain a BCA report and check on the organization.
  • Verify any charities or non-profit organizations through sources such as the IRSGuidestar and Charity Navigator.
  • Check to see if the organization needs to be registered by contacting the National Association of State Charity Officials.
  • Visit the charity or organization yourself to ask about their program, their mission, how they provide services, and what their future goals are. Speak to the participants to get a firsthand idea of how the program is working.
  • If possible, donate directly to the charity or organization so that they can maximize each dollar, instead of giving money to a third party.
  • If the charity gives you the option to designate your donation to a specific disaster, do so. This will ensure that your money goes towards disaster relief, not into a general fund for the organization.
  • Keep records of all donations.
  • For security and tax purposes, avoid sending cash donations. Donate by check made payable to the charity or by credit card. Never wire money.
  • Don’t assume social media pages and messages posted from the charitable organization are authentic. Check for yourself by contacting the organization directly.
  • Avoid clicking on emails sent asking for donations. These are more than likely fraudulent and can install malware or a virus onto your device.

If you are aware of a charity scam, let BCA know so others are warned. File a complaint, write a review, or email us with the information.

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About Business Consumer Alliance:

Business Consumer Alliance (BCA) is a non-profit company that started in 1936. The broad purpose of BCA is to promote business self-regulation. BCA's mission is achieved by assisting consumers in resolving complaints with businesses and using that complaint information, along with other relevant information such as customer reviews, to forecast business reliability. With community support, BCA can identify trustworthy and ethical businesses and warn the public to avoid unscrupulous businesses whose purpose is to defraud the marketplace. BCA also helps businesses promote themselves by providing services and tools to protect their business and reach out to their customers. BCA obtains its funding from member businesses who support the mission and purpose of the organization and who agree to abide by high standards of ethical business practices.