Within hours of the occurrence of natural disasters such as the 2004 Indonesian tsunami, Hurricane Katrina in New Orleans, and last January’s earthquake in Haiti, fraudsters get busy pushing charity scams on the Internet.
Cybercriminals eager to exploit people’s desire to help put ads on Craigslist or set up websites similar to those of recognized charities and send out emails making appeals for contributions.
In the case of Hurricane Katrina, the problem became so pronounced that U.S. authorities established a task force to investigate and deter fraud related to the disaster.
It may come as no surprise then that a growing number of Canadians are worried about fraudulent charities that intend to pocket hard-earned donation dollars.
New survey findings show that 53 percent say they are less likely to give to charities because of concerns about charity fraud, while 65 percent report an increased concern over the possibility of fraud—particularly in the wake of a natural disaster.
This is up considerably from 51 percent in 2009, something Kirsten Beardsley of CanadaHelps says stems from media coverage of charity fraud in Haiti, as well as the case of an Ontario woman who pretended to have cancer in order to receive charitable donations.
“I think we’ve had a kind of a year where it’s on people’s radar, and I think people are just in general becoming more wary of fraud, and maybe more aware of the risks that are out there,” Beardsley says.
To offset this trend and educate the public about charity fraud, CanadaHelps has teamed up with Capital One Canada during Fraud Prevention Month for their annual Charity Fraud Awareness Quiz, which helps participants identify and hopefully avoid charity fraud.
“We want to make sure that people are educated and aware and still able to give,” says Beardsley.
“It would be a real tragedy if this started to have a real impact on people’s decision to give, and that legitimate causes that are doing such important work in their local communities and around the world would start to be hurt because of this perception of charity fraud.”
In the survey, commissioned by CanadaHelps and Capital One Canada, 41 percent said they do not check if a charity is registered, ask the particular solicitor for ID, or visit the charity’s website before making a donation.
CanadaHelps advises making sure the charity is registered with the Canada Revenue Agency and provides its charitable registration number. CanadaHelps.org only lists charities registered with the CRA.
Donors should also ask to see a charity’s financial statements to get a sense of how the charity spends its money, and avoid any charity that pressures them into making a donation or isn’t open to sharing more information about their organization.
Beardsley says it’s well worth taking the time to do some research before donating “so that you know your money’s going to the right place.”
The survey also found that 22 percent of respondents say they prefer to donate online, up from 2009, while the number who prefers to donate by cheque is down from 32 percent to 25 percent—a trend that appears to be driven by younger donors. Nearly a third of respondents aged 18-34 say online donations are their preferred method.
“With more and more Canadians preferring to donate online, it is increasingly important for credit card users to understand what to look for to ensure they are donating through a legitimate and secure website,” says Capital One spokesperson Laurel Ostfield.
Beardsley notes that while the number of victims of charity fraud isn’t growing, the concern around false soliciting is, with the occurrence of natural disasters heightening that concern.
However, she doubts the recent earthquake in Christchurch, New Zealand, will prompt the same level of fundraising—or the same rash of scams—that Haiti did.
“New Zealand is a developed country and we tend to not pour our support into those kinds of areas. I don’t think that fundraising amounts will match what we’ve seen in Haiti, for example.
“[But] if New Zealand becomes a situation where people do start giving in high numbers and the media profile is there, I think that we will see a scam or two pop up. …. The scammers are opportunistic and they’re going to go where they think they can get money.”