Wise Giving Wednesday: What is a Charity Scam?

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calendar icon Jan 10, 2024

With over a century of experience in reporting on charities, BBB Wise Giving Alliance recognizes that people often look for communication short-cuts in identifying concerns about charitable giving. While the term “charity scam” is frequently used as a generic criticism of suspicious charity behavior, it actually has a narrower definition. When a person or an entity is accused of conducting a charity scam it generally means someone has been tricked into donating money under false pretenses. In other words, the scammer has committed a fraud, an illegal act, with an intent to deceive the donor to provide a contribution that will be used for personal gain, not a charitable purpose. With sufficient evidence, a government law enforcement division can take action against such alleged behavior.

What are some examples of such charity scams?  A website that collects funds for a disaster relief charity that does not exist. An email message claiming to be raising money for a well-known charity is actually a phishing activity seeking to obtain personal and financial information from potential victims. Or a telephone solicitor that claims to be raising money for a veterans charity but uses the donor's credit card number for other purposes. While activities like these have occurred over the years, charity scams are really just a small part of the solicitation marketplace.

The vast majority of charities are well managed but sometimes deficiencies can occur in an organization’s governance, finances, transparency and/or accountability. These are the type of issues that are addressed in the 20 BBB Standards for Charity Accountability. While some of the most egregious circumstances that are covered by these standards might help reveal potential illegal activities (for example, strongly misleading appeals), such conclusions are very rare. Most potential donors are seeking to give with confidence by identifying a charity that meets recognized standards and is fully accountable to contributors. Charities that meet all of our standards are called BBB Accredited Charities and can be found on Give.org.

So, the next time you wonder whether a charity appeal is a scam, you might want to consider whether you are really asking about fraud or just have potential concerns about how well the charity is run.

Video of the Week

As part of BBB WGA’s Building Trust Video Series, BBB Wise Giving Alliance interviews Karen Knudsen, MBA, PhD, Chief Executive Officer of the American Cancer Society (a BBB Accredited Charity) that seeks to improve the lives of people with cancer and their families through advocacy, research, and patient support, to ensure everyone has an opportunity to prevent, treat and survive cancer.   

Heart of Giving Podcast

This week’s Heart of Giving Podcast features BBB WGA President & CEO, Art Taylor, providing highlights of all the podcasts held in the past year. This is Part 1 of a two-part series.

Recent Reports

We are always working with charities to publish or update reports for donors. Visit Give.org or local BBBs to check out any charity before giving. Our recently evaluated charities include:

Finally, remember to let us know by going to give.org/charity-inquiry if you are interested in seeing a report on a charity not on the list and we will do our best to produce one.

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