StopScum

January 08, 2005

The Phony Charity Scam - Part Two

On Friday (1-7-05), President Bush signed into law a bill extending the deadline through Jan. 31, 2005 for claiming charitable contributions in 2004. As long as taxpayers give cash and it goes to aid victims of the South Asia tsunamis. This will certainly produce a spike in Scamers and Fruadsters trying to steal either your donation or your idenity.

Email Charity Scams

Here is an actual charity scam email:

"RESCUE Help Family and Friends find their missing

Beliefnet
Send E-Mail to: map98pam@hotmail.com
Copyright 2004 P Miller. All Rights Reserved"

What is wrong with this charity scam email?

1. It's spam and reputable charities don't spam

2. The charity uses a PO Box and does not contain a phone number. Reputable charities have a street address and a phone number

3. All the email addresses used are havens for abusers. They are free email addresses where Scam artists hide and PayPal is a fraudsters best friend since it contains a minamum of fraud checks and or idenity checks. Reputable charities don't use PayPal and always provide an email address which is part of their web site like "donations@charityname.com

Phishing Abuse via Scam Charity Web Sites

They don't want your contribution. They want your confidential data such as your name, address, and credit card number. They are using a phony charity Web Site and email to lure you into this trap.

Perform your due diligence and take precautions

1. Trash all email which asks you to contribute and or visit a web site to make a contribution.

2. Use the following resources to investigate a charity before you contribute:

Charity Watch
BBB's Wise Giving Alliance
GuideStar
Charity Navigator
FTC Charity Checklist

3. Consult with your tax person and or attorney on your compliance with this new federal law. Consult IRS Publication 526 and the IRS web site.

Posted by Steve_S

December 29, 2004

The Phony Charity Scam

The recent powerful earthquakes and deadly tsunamis in South Asia has killed over 70,000 people. I'm sure this devastating event tugs at your heart strings and results in many folks sending donations to their favorite charity. Unfortunately, Spammers are already planning to exploit this event and worst of all, phony charities will proliferate.

Perform your due diligence before you contribute to a charity

Don't read the Spam. Determining which charity is legitimate is a little harder. Your goal is to find a reputable charity which donates nearly all the money collected to your given cause. A round number is about 92 cents out of every dollar collected should actually go to the cause. We have some tips to help you:

1. Don't talk to any charity which calls you on the phone. These boiler plate operations are a huge red flag. Just hang up.

2. Check the name of the charity very carefully. The fraudsters will often use similar names. For example, Kids Wish USA was a scam. "Michael Manzer, was sent to prison for mail fraud and money laundering. This charity promised to grant the wishes of terminally ill children yet it did not grant even one wish, according to federal prosecutor Mike Snipes." Source: Charity Watch Notice the similarity to the legitimate charity named "Make a Wish Foundation".

3. Check the record of the charity with their local Better Business Bureau

4. Ask the charity to send you printed material via US mail. If the material does not contain details on exactly how the money is used and the percent of donations which actually reach the given cause, do not contribute.

5. Ask the charity for annual financial statements and proof of their IRS 501c non profit status. This is generally granted via an "award letter" from the IRS.

6. Avoid all charities that use a "pitch" filled with a significant amount of emotional words and or images.

7. Setting up a phony charity is pretty easy. Check the rating of the charity with Charity Watch before you contribute.

Posted by Steve_S