Tragedy brings out scam artists; BBB tips for wise giving

2013-07-02T18:00:00Z Tragedy brings out scam artists; BBB tips for wise givingAngela Pittenger Arizona Daily Star Arizona Daily Star
July 02, 2013 6:00 pm  • 

In the wake of the loss of the Prescott firefighters to the Yarnell fire, the Better Business Bureau has issued tips for wise charitable giving. 

“Unfortunately as we have seen with the Newtown School shooting and Boston Marathon bombings, tragedy brings out scam artists,” BBB President Kim States said. “While it is a natural reaction to want to help the victims’ families and community through donations, we encourage donors to learn more about the charity before contributing.”

The BBB's Wise Giving alliance, which monitors national charities, is a good source for information on such charities. Check it out at give.org.

Here are tips that should be considered before responding to a text message, email, phone call, door-to-door or social media posting soliciting donations:

1.Take the time to check out the charity to avoid wasting your generosity by donating to a questionable or poorly managed effort. The first request for a donation may not be the best choice. Be proactive and find trusted charities that are providing assistance.

2. Remind friends and family to be cautious about giving requests in the wake of such a tragedy and ask them to spread the word as well. People are emotionally moved by events like these and may react before they have time to carefully consider.

3. About 40 of the 50 states require charities to register with a state government agency (usually a division of the State Attorney General’s office) before they solicit for charitable gifts. If the charity is not registered, that may be a red flag.

4. Organizations raising funds should get permission from the families to use either the names of the victims and/or any photographs of them. Some charities raising funds for the Colorado movie theater and Newton school victims did not do this and were the subject of criticism from victims’ families.

5. Watch out for vague appeals that don’t identify the intended use of funds. For example, how will the donations help victims’ families? Also, unless told otherwise, donors will assume that funds collected quickly in the wake of a tragedy will be spent just as quickly. See if the appeal identifies when the collected funds will be used.

6. Some families may decide to set up their own assistance funds. Be mindful that such funds may not be set up as charities. Also, make sure that collected monies are received and administered by a third party such as a bank, CPA or lawyer. This will help provide oversight and ensure the collected funds are used appropriately (e.g., paying for funeral costs, counseling, and other tragedy-related needs.)

7. Never click on links to charities on unfamiliar websites or in texts or emails. These may take you to a lookalike website where you will be asked to provide personal financial information or click on something that downloads harmful malware into your computer. Don’t assume that charity recommendations on Facebook, blogs or other social media sites have already been vetted.

8. After funds are raised for a tragedy, it is even more important for organizations to provide an accounting of how funds were spent. Transparent organizations will post this information on their websites so that anyone can find out and not have to wait until the audited financial statements are available sometime in the future.

9. While a personal giving choice, consider that an established charity will more likely have the experience to quickly address the circumstances and have a track record that can be evaluated. A newly formed organization may mean well, but will be difficult to research.

10. Not all organizations collecting funds to assist this tragedy are tax exempt as charities under section 501(c)(3) of the Internal Revenue Code. Donors can support non registered entities, but should keep in mind that if they want to take a deduction for federal income tax purposes, they will not be able to. In addition, contributions that are donor-restricted to help a specific individual/family are not deductible as charitable donations, even if the recipient organization is a charity.

For more information, visit the Better Business Bureau online at www.tucson.bbb.org.

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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The Star’s Centsible Mom, Angela Pittenger, will blog about great deals, tips to stretch your dollars and ideas for living frugally.

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