Don’t get Scrooged by scammers: Avoiding charity scams this holiday season

WILMINGTON, N.C. (WECT) - People make donations to charities for all kinds of reasons, but one thing they all have in common is the desire to give back out of the kindness of their hearts. So when scammers take advantage of that kindness, it not only hurts the charities who miss out on that money — it also hurts people who feel taken advantage of.

That can have lasting impacts on the donations people make in the future if they’re unable to feel confident their money is going where they believe it’s going. In 2022, North Carolinians have been exceedingly generous with their money, nearly double compared to 2021.

“Charitable giving in North Carolina grew almost 40% in the past year as the state’s giving public responded to increasing needs with unswerving generosity and charities worked tirelessly to do the maximum good with each charitable dollar, resulting in a record high 81.79% of donations going to charitable programs,” according to the North Carolina Secretary of State Elaine Marshall.

The holiday season also is one of the most crucial times for charities and other nonprofits who are hoping to meet end-of-the-year goals. Kevin Scally works for Charity Navigator, an organization that tracks charities across the country to help folks know more about where their money is going. These scams are a bigger problem than many people might realize.

“So far in 2022, more than 4,538 reports about charitable solicitation scams have been filed with the Federal Trade Commission,” Attorney General Josh Stein said in a press release. “When you donate your hard-earned money, you should feel confident that it’ll help others, not line some scammer’s pocket. As we near the holidays, please take care so scammers don’t exploit your goodwill.”

Scally says current events across the world have led to increased donations, but also an increase in scammers trying to get your hard-earned cash.

“With the pandemic and racial injustice and natural disasters is that there’s been a lot of things that pull at the heartstrings. And unfortunately, in times of crisis, it can bring out the best in people where people do want to give back, but it can also bring out the worst in people where they try to take advantage of people’s generosity,” he said.

According to the Federal Bureau of Investigation, in 2020 more than $4 million was lost to charity scams, and FBI data shows these losses are on the rise. In 2018, FBI data shows the cost of charity scams in the country was slightly more than $1 million.

The American Association of Retired Persons (AARP) also tracks scams that often target older adults, and while that demographic might be a higher targeted group, nobody is completely immune to falling victim.

“Three-quarters of U.S. consumers have experienced or been targeted by at least one form of fraud that can be tied to the holidays, including requests from (often fake) charities, online shopping scams and fraudulent communications about shipping problems,” according to the AARP.

Give with your heart and your head

For those considering donating, Scally says he encourages people to give back and doesn’t want to dissuade anyone from doing so, but also wants people to be smart about it.

“The first thing that I say is to do just that - give with you with your heart, but also give with your head. What I mean by that is to do a little bit of due diligence. Based off of a report by Gray Matter Research, only about 30% of people actually use a charity evaluator before they give. And obviously, that means that a lot of people are maybe giving to organizations that are less impactful, less efficient, and then also going to potentially scams as well,” Scally said.

With so many charities and causes, it can be difficult to pick the right one, but there are ways to protect yourself from falling victim to those hoping to take advantage of you. In North Carolina, Stein said checking with the Secretary of State is a good way to vet any group you’re considering.

“Many charities that solicit in our state are required by law to register with the N.C. Secretary of State. You can call that office toll free at (888) 830-4989 or check out a charity or fundraiser on its website. The license application provided during the registration process should give you information about the charity’s finances and operations,” according to Stein’s office.

The Secretary of State provides a simple checklist that donors are encouraged to use called the Donor Checklist. It’s a form that provides people with a place to write down important information about charities, especially if they receive a cold-call asking for donations.

Charity Navigator is another resource that people can turn to. The group evaluates charities and provides easy access to data and other information to help people learn more about the charities they are considering. One of the easiest ways to track down a charity and confirm their status is to ask for their EIN.

“Ask the charity what their Employer Identification Number (EIN) is. If they don’t have one -- don’t donate. Once they give you their EIN, you can find them on the Charity Navigator site. If you can’t -- don’t donate. (Of course, there are brand new organizations who haven’t yet filed their first Form 990, so ask if they’re a newly opened organization, which would explain why they’re not on the Charity Navigator site. Also, if an organization is fiscally sponsored, they will not be listed on our site, only their fiscal sponsor),” according to Charity Navigator.

Red flags and what to do if you are scammed

As for other ways to spot a scam, Scally say there are other red flags.

“Avoid any sort of high pressure situation. I mean, there are certainly tactics that valid organizations are using in those in those cases where, you know, you will get a phone call, you will get a text message, maybe somebody will stop you in the street. … maybe they’re making a really good case for getting your support. But that need is still going to be there a couple of hours later, a couple of days later. So it’s okay to take your time and say, ‘hey, you know, maybe later, let me think about this, let me do a little bit of research,’” he said.

Giving back is often the biggest reason that people choose to donate their money, but there are also tax incentives for some donations. But not every donation is going to be tax deductible, so it’s important to do research before planning on writing off any money contributed. Fortunately, the AARP says there is a simple way to find out if your donation qualifies by using the IRS’s Tax Exempt Organization Search.

The AARP also says there are things you can do to protect your wallet and your heart.

“Another thing to consider is be careful how you pay,” AARP North Carolina Director Doug Dickerson said. “If someone wants cash donations, gift cards, or asks you to wire money, don’t do it. Those are sure signs of a scam.”

If you do find yourself taken advantage of, Secretary of State Marshall said her office, along with the Attorney General, do have some recourse they can take.

“We also have the ability to do civil remedies, or criminal if there’s out and out fraud involved … we’d rather prevent the crime, prevent the occurrence, then have to go investigate it. So that’s what we’re all about at this time of year,” she said.

Attorney General Stein is working constantly to battle scammers, not just during the holiday season. One of the biggest problems for North Carolinians that Stein is working to combat -- robocallers.

“There’s definitely a relationship between cell phones and charitable scams, because they will use the technologies that we have to their benefit. So for instance, a lot of these robocalls are actually on behalf of charitable Statehouse shutting down a company called associated care services that make some 1.3 billion phone calls on behalf of fake charities. And we found them out and we shut them down,” Stein said.

Unfortunately there will be scammers who are successful and Stein wants anyone impacted by these scams, or even if you believe you were contacted by a scammer, to do your part to help him shut them down.

“If you feel like you’ve been scammed, or if you have any questions, please contact my office, you can call us 877- 5-NoScam, or use the internet at NC doj.com/complaint. That information can help us establish our enforcement priorities,” he said.

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