Watch out for fundraising scams

Deep down, each of us wants to help to some degree those who are less fortunate than we are. This is commonly done by means of non-profit charities that have been set up for this purpose. Regrettably, con artists who have set up their own charity fronts, recognize that this is an easy method of wheedling money from caring and considerate people for the scammer’s own gain.

Not all fundraisers are scam artists but the problem facing the average citizen who wants to assist in some way those in need, is that they often don’t know which fundraising entities are legitimate and which ones are not. Some of the fundraising scammers are out and out swindlers but it isn’t always easy to discover that until long after people have given them part of their hard-earned money.

Popular deceptions in recent years are charities supposedly set up to help needy children and families in foreign countries. Pictures and videos of malnourished, emaciated children and impoverished needy families are portrayed in pamphlets and television spots. The viewer's feelings of sympathy are appealed to and an address or envelope is provided for the donor to give to what he or she believes is a worthy cause.

Not all such fundraisers are scammers but it is unwise to donate money to a charity without first researching how the money is actually going to be used. Frauds that have been exposed make it clear that the funds given to these alleged charitable organizations were instead used primarily for the benefit of the organizers, and little or no money went to the needy. As a result, potential donors then become suspicious of all charities, including the honest ones that use the money as advertised.

Charity scams come in many forms. It can be a plea for the homeless, the destitute, animals, and just about anything else. While there are many legitimate charities in existence there is always someone in the wings that will use any means to remove money from someone else’ pockets in order to fill their own.

Charitable organizations sometimes use magazines, mailings, newspapers, television, the Internet, and other means to reach a wide audience. Their requests typically start at ten dollars and go up from there. The advertising itself is expensive, and much of the money is used for this purpose.

If a donor sends in ten dollars, it is probable that ninety percent of that money will be used for advertising, marketing, administration and salaries for the fundraisers. So if a donor wants ten dollars to go to those in need, he or she would have to send at least a hundred dollars to the fundraiser. In one case, a charity organization was actually authentic, completely registered, and really did send money and resources to foreign countries. Unfortunately, a federal investigation showed that almost ninety percent of all donations of that particular organization were used to pay the large salaries of the directors for the charity. As such, this organization was not considered to be a true charity and was instead considered a scam.

One should be especially suspect of people coming to the door with cans supposedly collecting for a well-known charity. One has no way of knowing if this is where the money is going or if it is going into the collector's pocket. It is so easy to paste a reputable charity’s name and logo on a can and then send children door to door to collect money from unsuspecting donors.

If the organization is well-known, a direct donation is the best way to go. If you never heard of the organization, keep your money in your pocket or purse.

How charity scams work

They may:

Approach you on the street or in your home, pretending to collect for a legitimate charity

Set up false websites or send letters similar to those used by real charities

Use unsolicited telephone calls or emails to ask for donations.

Warning signs

You receive an email asking for donations.

A collector makes a face-to-face approach but does not have any identification or has fake identification.

The collector cannot or will not give you details about the charity, such as its full name, address or phone number.

The collector becomes defensive when asked what the charity does and how much of the donation gets taken up by costs.

The collector asks for cash, will not accept a cheque or does asks for any cheque to be made out to them rather than to the charity. Illegitimate online collectors will insist on payment by money transfer.

The collector does not want to provide a receipt or the receipt does not have the charity’s details on it. Registered fundraisers are authorized to give tax receipts but that doesn’t necessarily mean that the person at the door will be giving you a legitimate tax receipt.

Studies show half of charity donations are made between Thanksgiving and New Year's Eve.

But when a charity you've never heard of lures you with an emotional plea or proposes an unlikely sounding scheme, it's time to start asking questions.
Real charities will spend 60 to 99 percent of the money they collect on the people they are supposed to serve. By contrast, charity scams often wind up spending most or all of the money on its administrators.

If you want to donate

Donate to established relief organizations with a strong record in providing aid. Be wary of giving money to an unfamiliar charity.

Approach charity organizations directly to make a donation. Ring the fundraiser’s
hotline if you want to donate over the phone. Never use a phone number or website address given by a person who first called, visited or emailed you.

Do not use links to websites provided in emails. If you want to donate online, it is safer to search for the charity’s official website using a search engine – websites set up by scammers are less likely to rank highly.

Never respond to an unsolicited email asking for donations - even if it claims to represent a reputable fundraiser or seems legitimate.

Only hand over money to someone wearing proper identification and always ask for a receipt. If they are not wearing identification, ask to see it. Make sure collection tins or containers are sealed and clearly labelled with the fundraiser’s logo. Keep in mind however that charity logos can be copied by scammers.

Never give out your personal, credit card or online account details unless you initiated contact and it is a trusted source. If you are still unsure, ask the fundraiser if you can donate at a local bank.

If the charity is well known but you are suspicious of a collector in your area, contact the charity and ask if they are aware of the collector.

Here are some of the charity scams that people fell for.

St. Stephen is a Canadian town in Charlotte County, New Brunswick, situated on the east bank of the St. Croix River. Here is a love story with a bizarre twist that took place in that small town.

The name Caron Oderbien may not sound familiar with St. Stephen residents, but many will remember her alias, Caron Hudye. She is one and the same. Oderbien came to St. Stephen after duping a local man, Spencer Murphy to take her in. From there, she allegedly orchestrated a series of scams playing on the emotions of the people in the town.

She claimed that she supported the troops and she supported sick children and of all the sick children’s causes she chose, it was that of Katlyn Kent. The 16-year-old had been diagnosed with leukemia, and Oderbien used the young woman as a centre piece for her fundraising efforts. When Katlyn was diagnosed with leukemia, Oderbien promised to raise money to help. She enlisted the entire town to support a charity concert, sold tickets. Then after conning people in that small town out of some of their money, she left town two days before a Julian Austin concert she had promoted to raise funds for Kent and the troops was slated to take place. And when she left, she took all the proceeds she scammed from her donors with her.

Official documents obtained by W5, (a Canadian TV show) including past stories from The Saint Croix Courier/Courier Weekend, paint a picture of the alleged serial scammer as a woman who “has a pattern of getting in a relationship, stealing her partner’s money and running away.”

W5’s Victor Malerek led its viewers on a hunt across Canada for the elusive Oderbien. Malarek followed her trail from Kingston, Ontario, to New Brunswick and across the Prairies.

If Kingston, Ontario electrician Roger Gipson had known about Caron Oderbien’s shady past, he wouldn’t have lost $140,000 and most of his family’s farm. What Gipson didn’t know was that his about-to-become girlfriend had a criminal record for fraud, and had taken at least two other men for hundreds of thousands of dollars.

It was Gipson that alerted W5 to the story in early August of last year. Murphy and Gipson were not the only men Oderbien duped: she served time in a Colorado prison for defrauding her friend, Craig Carpenter, in 2003; even earlier she took Saskatchewan business owner Daryl Lowenberg for hundreds of thousands of dollars, including his house – which she literally stole, loading it onto a flatbed and moving it to Manitoba.

W5’s Malarek pieced together an incredible “catch-me-if-you-can” tale that includes a trail of broke and broken-hearted men. H said, “These kind where you see people using charities and kids who have cancer, and fallen soldiers that really falls way below the pale.”

Last year, a group calling itself ‘Alabama Children and Family Services’ had been phoning and sending literature to local residents claiming to be raising money on behalf of south Alabama shelters for battered women and children, according to officials with those shelters.

But the organization — which records show is in fact based in Milton, Florida has been using the names of ‘Mobile’s Penelope House’, ‘The Lighthouse in Robertsdale’ and ‘’Daybreak’ in Jasper and others without permission, officials with the shelters said. They also said that the shelters have received little or no money from the group’s fundraising efforts.

"The specter of an unknown and out-of-state telephone solicitor using the good reputation of local programs to raise funds worries us greatly," said Carol Gundlach, executive director of the ‘Alabama Coalition Against Domestic Violence’, a network of the 18 domestic violence programs across the state.

An e-mail sent by the Press-Register to an address on the web site of ‘Alabama Children and Family Services’ was answered by a Gary R. Tomey II, who said he is the organization’s president.

"We do not use other charities’ names to gain contributions," Tomey wrote. "We do, however, list them on our web site and in our mailings for self-help purposes. We do have funding available for any shelter in need in the state of Alabama but they do need to go to our web site and download the grant request (form) and submit it by e-mail or regular mail."

Listing other charities on Tomey’s phony charity’s website is simply a ploy to make his own website and phony charity look legitimate.

Another of his phony charities is called ‘Florida Children and Family Services’ which is listed as a nonprofit in Milton, Alabama but it is not accredited by the Better Business Bureau. The Alabama Secretary of State’s office lists ‘Children and Family Services of Milton’ as an out-of-state nonprofit established Dec. 22, 2008. The Press-Register was unable to find any organization with the exact name ‘Alabama Children and Family Services.’

The telephone number listed on the Alabama Children and Family Services website and the group’s Florida site also is found on Internet sites soliciting funds for similar purposes by groups called ‘Indiana Children Services’ and ‘Ohio Children Services’.

Tomey confirmed by e-mail that "there is one office that raises funds in several states and one toll-free number that all rings to the same phone and we answer when we can as ‘Children and Family Services.’"

Gundlach said all ‘Alabama Coalition Against Domestic Violence’ member shelters "will ensure that any money raised in the local community is also spent in that community. Sadly, we cannot guarantee the same for a telephone solicitation operated by an out-of-state charity."

This creep, Tomey is obviously extending his tentacles in various states in the United States.

In the wake of Japan's quake crisis, many Americans are eager to help. But they must be aware of scammers seeking to take advantage of them.

The Federal Bureau of Investigation said they are already investigating one potential scheme where fraudsters misrepresent themselves as the ‘British Red Cross’ and seek donations.

"I hadn't heard about this yet, but sadly this has happened previously," said Penny Sims, spokeswoman for the legitimate British Red Cross." After any major disaster, there are some unscrupulous people that try to use other people's misfortune to their own end.

So far this is the only scam the FBI has received complaints about, but "agents are looking for more of those types of appeals," said Jenny Shearer, a spokeswoman with the FBI.

After the earthquake in Haiti, more than 350 complaints were filed about fraudulent activity, she said.

Avoid getting scammed

"Anytime something comes into your inbox asking for money, rather than answer, call your local Red Cross yourself," FBI's Shearer advised. "Anytime someone comes to you asking for money, you should be suspicious.

"In my experience, the Red Cross has never emailed me, never," she added.

To further protect those eager to make donations, the FBI has issued the following guidelines:

Do not respond to any unsolicited incoming emails that are seeking money from you.

Be skeptical of individuals claiming to be surviving victims or foreign government officials asking for help in placing large sums of money in overseas bank accounts.

Go directly to recognized charities' and aid organizations' websites instead of following a link from an email or another site.

Attempt to verify the legitimacy of nonprofit organizations by checking their status with the local, provincial or state and federal governments.

Be leery of emails that claim to show pictures of the disaster areas in attached files, as the files may contain viruses. Only open attachments from known senders.
Donating a car to charity sounds like a win-win proposition. The donor has a hassle-free way to get rid of an old car and gets a tax deduction for doing it. The charity gets an asset it would not have had otherwise.

The problem is often very little of the car's value goes to charity. For-profit businesses handling the cars on behalf of the charities pay costs to tow, condition cars and advertise. They then sell them at wholesale auctions, leaving very little for the charity they claim they are doing it for.

Even worse, some sleazy middlemen purposely disable cars so they can be sold more cheaply, then they are re-sold for a profit after they are ‘fixed.’

The best way to donate a vehicle is to identify a charity that actually uses vehicles in its programs, for example, delivering meals to the homebound, taking elderly or blind people to the doctor or on errands, or training future auto mechanics.

You can contact the United Way, Goodwill, Salvation Army, community college or vocational school to locate a program that actually uses cars.

Unless you have signed up to receive email from a charity, do not respond to email charity solicitations. Real charities do not normally recruit new donors by email, and especially not by spam.

Email charity scams may use legitimate sounding names and link to a website where you can make a donation. These tend to be fake websites made to look like an organization's official site.

Be wary of websites that ask for personal information like your Social Security number, date of birth or bank account information, which can lead to identity theft.

If you want to help the charity mentioned in the email, contact them directly with a phone call or use a Google search to find their real website.

More and more charities are accepting donations made on their official websites, so it's not wrong to make a donation this way. Just don't use an unsolicited email to get there.

Police and firefighters put their lives on the line for us every day. So, some well-deserved backup often seems like the right thing to do. But where is your donation to that police charity really going? Just because police leagues, sheriff's associations or firefighters' relief organizations have the words "police" or "firefighter" in their name doesn't mean your local officers will be the ones who benefit.

Before you give, make sure you know whether the group is a local, state/provincial or national organization. Get specifics on the programs your donation will fund and make sure you understand how they will help your local officers.
Ask how much of your money goes towards the officer program. If the donation is used to purchase an ad in the charity's journal or to buy circus tickets, most of it may well get eaten up in production costs.

My advice is simply to be cautious here. Unfortunately, there are a lot of scam organizations that may sound legitimate, but do little or nothing to contribute to the police and firefighters that donors believe they are helping. Make sure your donation is actually making the contribution you want.

Many people first learn of a charity through a telemarketer call. (Charities are not bound by the Do-Not-Call list.) These calls are typically made by for-profit fundraisers hired on behalf of the charity.

Though many charities raise money this way, these for-profit companies may keep anywhere from 25 to 95 cents of every dollar they collect. Charities raising money this way count on repeat donors to offset the first year's fundraising expense.

Don't give as a knee jerk reaction. Instead, research any charity you are considering. Make sure they spend most of the donated funds on their programs and keep advertising and administrative costs below 25 percent. A well-run legitimate charity welcomes questions.