BBB Tip of the Week: Watch out for scammers trying to profit after natural disasters
Tropical Storm Lane roared near Hawaii, causing damage to homes, roads and buildings in the area. This latest natural disaster hit an area already reeling from flooding and a volcanic eruption, and it has many people looking for ways to help those affected.
Unfortunately, scammers almost always look for ways to benefit from disaster. In the wake of a natural disaster, Better Business Bureau Northwest and Pacific is urging donors to give thoughtfully. To ensure credit card and personal information is safe and the dollars that you are contributing get to those in need, BBB has the following tips.
Thoughtful giving: Take the time to research the charity to avoid donating to a questionable or poorly managed effort. The first request for a donation may not be from the best choice. Be proactive and find trusted charities that are assisting. Visit Give.org to verify if a charity meets the BBB Standards for Charitable Accountability.
State government registration: A charity in Hawaii that solicits contributions must register with the state attorney general unless it can prove exemption status. If the charity is not registered, that may be a significant red flag.
Ask how donations will be used: Watch out for vague appeals that don’t identify the intended use of money. For example, how will the donations help victims’ families? Also, unless told otherwise, donors will assume that money collected quickly in the wake of a tragedy will be spent as quickly. See if the appeal identifies when the collected funds will be used.
Online caution: Never click on links to charities on unfamiliar websites or in text messages or email. These may take you to a look-alike website where you will be asked to provide personal financial information, or may download harmful malware onto your computer. Don’t assume charity recommendations on social media already have been vetted.
Newly-created vs. established organizations: This is a personal giving choice, but an established charity will more likely have the experience to quickly address the circumstances and have a track record that can be evaluated. A newly-formed organization may be well-meaning but will be difficult to check out and may not be well-managed.
Research crowdfunding pleas. Some crowdfunding sites are legitimate and work to ensure requests for donations are truthful. But in the aftermath of a disaster, it can be difficult to vet every plea. Consider only donating to crowdfunding organizers you know personally.
Tax deductibility: Not all organizations collecting funds are tax exempt as charities under section 501(c)(3) of the Internal Revenue Code. In addition, contributions that are donor-restricted to help a specific individual or family are not deductible as charitable donations, even if the recipient organization is a charity.