Fraud 101: Holiday & Charity Scams

Many charities ramp up their activities during the holiday season, which means it's prime time for those trying to make a fraudulent buck. The same thing happens after natural disasters and other emergencies: scammers come out of the woodwork, hoping to skim off some of the money directed at legitimate charities into their own coffers.

The solicitation might be a piece of mail, a phone call, a social media post – or even a knock on your door. No matter how the request comes in, be vigilant before before you open your purse strings, even if the story tugs on your heartstrings. Here are some key tips to remember:

• Do due diligence. Who wouldn't want to support Wounded Warriors Family Aid? Well, anyone intending to give to Wounded Warriors Family Support, for starters, as that's the real charity. While some scam artists make up organizations from whole cloth, others will create knockoffs of established groups to trade on their good reputations. Check names carefully and always research groups you haven't given to before to make sure they're legitimate.
• Choose your charity carefully. One of the most important metrics for any charity is the amount of your donation that goes toward the cause (keeping in mind that it's important for groups to be able to pay staff adequately and spread their message). A charity spending more than 50 cents of each dollar on overhead is a big warning sign your donation is more likely to feather someone's nest than help someone in need.
• Give through established channels. Scammers can mimic phone numbers, including local ones, to make their pitches seem more authentic. They may create fake websites or social media accounts as well. To protect yourself, you should always initiate the donation. Don't give to someone over the phone who called you; call the number listed on the charity's official website. Don't click on links in an email to access a donation page; type the URL directly or find it via search engine.

If you are or suspect you've been a victim of fraud, report it to the FTC, the Iowa Attorney General and your financial institution.