CHICAGO, IL – May 23, 2013 – In the wake of a tragedy, scammers like to rise and take advantage of kind, giving people. The Better Business Bureau serving Chicago and Northern Illinois (BBB) is alerting consumers of the possibility of phony charity scams related to the Oklahoma tornado.
“Tragedies bring people together and inspire many to help out by giving,” said Steve J. Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. “Unfortunately, the aftermath of natural disasters is also a time when scammers find ways to take money from good people.”
The BBB recommends asking the following questions before choosing to donate to a specific charity:
Is this a charity I can trust? Look at the appeal carefully; some charities have similar sounding names. Don't be fooled by names that look impressive or that closely resemble the name of a well-known organization. Check with your appropriate state government authorities (this is usually a division of the state’s office of the attorney general) to verify the charity is registered to solicit in your state. Also, visit the website of the BBB Wise Giving Alliance (www.bbb.org/charity) to find out whether a national charity meets the 20 BBB charity standards that address charity governance, finances, fund raising, donor privacy, and other accountability issues.
How will the charity use my donation? Ask questions about how your donation will be used. Beware of appeals that bring tears to your eyes but give few details of what the charity is doing about the problem it describes so well. For example, if the charity says it’s helping the homeless, do they explain how (shelter, food, medical care) and where this is taking place?
Watch out for statements such as "all proceeds will go to the charity." This can mean that only the money left after expenses, such as the cost of written materials and fund raising efforts, will go to the charity. These expenses can sometimes be high, so check carefully.
Is my donation tax deductible? If you want to take a charitable deduction for federal income tax purposes, make sure the organization is tax exempt as a charity under section 501(c)(3) of the Internal Revenue Code. A charity appeal will usually include a reference to this. To verify a charity’s tax status, access an IRS database of organizations by viewing Publication 78 on the IRS website at www.irs.gov. Consult your tax advisor for details.
Can the charity actually use what I’m donating? All charities welcome the receipt of monetary donations, but some also solicit in-kind donations such as clothing, food, and toys. If you’re planning to donate items to a worthy cause, make sure you know the in-kind contributions your charity prefers. For example, a food bank may prefer food items that are not perishable such as canned goods.
Am I feeling pressured to give? Don't succumb to pressure to give money on the spot, either immediately over the phone via credit card or by allowing a "runner" to pick up a contribution. Take the time to research the charity fully; the charity that needs your money today will welcome it just as much tomorrow.
The BBB is asking anyone who receives a suspicious charitable solicitation to report it to BBB Report a Scam.
For more advice on giving and to view reports on charities visit www.bbb.org/charity
As a private, non-profit organization, the purpose of the Better Business Bureau is to promote an ethical marketplace. BBBs help resolve buyer/seller complaints by means of conciliation, mediation and arbitration. BBBs also review advertising claims, online business practices and charitable organizations. BBBs develop and issue reports on businesses and nonprofit organizations and encourage people to check out a company or charity before making a purchase or donation.