Reminder: Don’t be taken in by a charity scam

by Chris Morran, The Consumerist

Between the recent tragic flooding in Colorado and yesterday’s fatal shooting in Washington, D.C., it’s been one of those weeks that make many people want to do something, anything, to help those who are grieving, suffering, or in need. Sadly, as we’ve seen too many times to count, tragedies always bring out the worst in a small number of people looking to cash in on the charity of well-meaning folks.

So, here are the basics you need to know when it comes time to figure out whether a charity is on the up-and-up, or whether it’s a scam intended to target the goodhearted:

Don’t be shy about asking who wants your money.
If you’re solicited for a donation, ask if the caller is a paid fundraiser, who they work for, and the percentage of your donation that will go to the charity and to the fundraiser. If you don’t get a clear answer — or if you don’t like the answer you get — consider donating to a different organization.

Call the charity.
Find out if the organization is aware of the solicitation and has authorized the use of its name. If not, you may be dealing with a scam artist.

Ask for written information about the charity.
This includes its full name, address, and telephone number.

Contact the office that regulates charitable organizations in your state.
The National Association of State Charity Officials has contact information for regulators in each state available on its website. Your state office also can verify how much of your donation goes to the charity, and how much goes to fundraising and man­agement expenses. You also can check out charities with the Better Business Bureau’s Wise Giving Alliance and GuideStar.

Trust your gut and check your records.
Callers may try to trick you by thanking you for a pledge you didn’t make. If you don’t remember making the donation or don’t have a record of your pledge, resist the pressure to give.

Be wary of charities that spring up overnight.
This is especially true after natural disasters. They may make a compelling case for your money, but as a practical matter, they probably don’t have the infrastructure to get your donation to the affected area or people.

Watch out for similar sounding names.
Some phony charities use names that closely resemble those of respected, legitimate organizations. If you notice a small difference from the name of the charity you intend to deal with, call the organization you know to check it out.

Be wary of charities eager to collect cash.
If they say they are sending a courier or offering overnight delivery service to collect your donation immediately, you have to wonder whether the charity is legitimate.

Know the difference between “tax exempt” and “tax deductible.”
Tax exempt means the organization doesn’t have to pay taxes. Tax deductible means you can deduct your contribution on your federal income tax return.

Do not send or give cash donations.
Cash can be lost or stolen. For security and tax record purposes, it’s best to pay by credit card. If you’re thinking about giving online, look for indicators that the site is secure, like a lock icon on the browser’s status bar or a URL that begins “https:” (the “s” stands for “secure”)