After a New York City man was indicted last year for allegedly running 76 fake charities out of his Staten Island home, experts are warning New Yorkers to be on alert this giving season.
Call it the holiday spirit, call it tax-time preparation — nonprofits receive more than a quarter of their annual donations in the month of December, according to the annual M+R Benchmarks Study, which assesses the data of 215 global charities, including the American Museum of Natural History, Planned Parenthood and public media companies. The last day of the year is the busiest of all, the study shows.
But while December is a time for giving, it’s also a time that fraudulent charities prey on that holiday generosity, said Kevin Scally, chief relationships officer for Charity Navigator, a nonprofit that rates other charitable organizations.
“It definitely brings out the best in people, where they want to give,” he told Gothamist. “But unfortunately, it also brings out the worst in people where people try to take advantage of that.”
While you’re feeling generous, don’t let the Christmas coquito lead you down the path of donating to a fraudulent nonprofit. Experts gave Gothamist three tips on how to avoid being the victim of a charity scam this year.
Don’t make an emotional decision
Scally said scammers often try to get donors to commit to payments quickly with high-pressure situations. An often-seen situation in NYC is when a person — frequently young and charismatic — asks for a minute of your time on the street and tries to solicit a donation.
While it’s fine to stop and talk, you should never feel pressured into giving a donation on the spot, in person or online, according to Scally.
“Do your due diligence," he said. "A charity that's looking for your money today is going to be just as happy to have it tomorrow."
The Better Business Bureau of Metropolitan New York has seen a rise in reliable charities making efforts to prove their legitimacy, president Claire Rosenzweig said.
“Charities are still having a really tough time post pandemic and raising money is tough," she explained. "Consumers are also looking for places that they can trust, and charities are trying to show that they're trustworthy.”
Legitimate charities are registered with government authorities or relevant regulatory bodies. Look for an EIN number, which all charities have, and search for it on the IRS website here. Use a charity rating website or go to the Better Business Bureau’s charity arm here, where nonprofits are ranked on 20 standards of accountability.
Also look for information about the charity’s mission, programs, financial transparency and past projects. Some scammers will register as charities with the IRS, but the money they collect is not going where you think it is.
Watch out for copycat scams
One of the most common scams is the “copycat charity” scam, experts said. Scammers use names that closely resemble legitimate charities to deceive donors.
Prosecutors said the NYC man indicted last year operated a long-running charity fraud that registered fake charities to the same Staten Island mailbox. Fake charities included lookalikes for the American Cancer Society and a charity called “The United Way of Ohio.”
Double-check the organization's name and website URL to make sure you’re donating to the charity you intend to give to. “There are a lot of reliable charities out there with similar names, so you want to make sure it's the charity you want to give to,” said Rosenzweig.
Be careful where and how you pay
Avoid making donations by cash, gift card, or wiring money, Rosenzweig warned. Instead, pay by credit card and keep a record of the transactions.
Scally said consumers are now seeing a lot of telemarketing, text and email scams from people who claim to be representing legitimate organizations.
“A lot of this happens, unfortunately, in the veteran space, for the fire department and police benevolent organizations,” he said. “Be alert with how people are reaching out to you and then just thinking before you pick up the phone or click that link.”
