When disasters hit, charity scams follow

Here’s the latest post-disaster weather forecast: Expect an avalanche of fake-charity scams.

Natural disasters often inspire people to donate money to relief efforts. But where money flows, con artists routinely pop up and establish fraudulent charities to accept donations from unsuspecting donors.

Officials in Florida and North Carolina have already issued warnings for people to be vigilant about charity scams expected in the wake of Hurricane Matthew.

Experts say the best advice for people wanting to help is to:

  • Donate to established nonprofits after verifying their identities and track records.

  • Be skeptical of pitches from groups you have never heard of or that refuse to provide you with documentation that proves who they are.

“When there is a disaster that is highly publicized, people want to help, but sometimes they let their emotion guide them rather than their brains,” says Daniel Borochoff, president and founder of CharityWatch, which evaluates charities on behalf of donors.

There are plenty of government agencies and watchdog groups that help deter scammers. State attorneys general and the Federal Trade Commission typically send out lists of tips to avoid getting conned and set up hotlines to report suspicious requests for charitable giving. They also advise being wary of contractors who move in after a disaster to assist with home repairs.

Burden falls on you
But with so many ways to communicate nowadays – such as with smartphones and social media – much of the burden to avoid fake-charity scams falls on individuals. For instance, donating via text messaging is becoming more popular, because people perceive it as being easy and quick. But verifying who gets the money when you text is trickier than donating by credit card or check.

Social media could also be a charitable landmine, Borochoff says, because people might pass along information to friends without anybody vetting it.

“People make the false assumption that something is legitimate because they get it passed on from a friend, who was duped,” he says.

Katherine Hurt, spokeswoman with the Council of Better Business Bureaus, a consumer organization, says scammers have evolved to incorporate new technologies.

“It’s gotten more sophisticated,” she says. “It’s really easy to create a real-looking charity. You can have a sophisticated website, robocalls, all kinds of things that look like a real charity and sound like one.”

For example, after a tornado hit Joplin, Missouri, in May 2011, killing 158 people and destroying more than 7,000 homes, Missouri’s attorney general sued a Puerto Rican organization called Alivio Foundation Inc., which he said fraudulently solicited donations on its website using PayPal. The foundation claimed the donations would be used to assist survivors and relatives of tornado victims in conjunction with St. Peter The Apostle Catholic Church and Catholic Charities of Southern Missouri, the attorney general’s office said. But neither the church nor Catholic Charities had ever heard of the Alivio Foundation. The company had received nearly $10,000 in donations intended for tornado victims.