Back to Blog

Is That a Charity Scam? How to Do Good and Avoid Losing Money

senior citizen in front of laptop holding their hand up

For the past ten years, the Charities Aid Foundation (CAF) has been publishing an annual report on giving behavior around the world, with the goal of helping donors and charities make a greater impact. They have surveyed 1.3 million people in 125 countries over the past decade to quantify people’s generosity of both time and money towards people and causes, with the United States topping the list each year.

This is no small feat and should remind us of the kindness in the world. We all choose different ways to give: helping strangers, volunteering, and donating money, to name a few. When you’re ready and looking to give, keep in mind that all this financial generosity translates into hundreds of billions of dollars in philanthropy every year. Unfortunately, with so much money involved, some less-than-honorable people look to exploit this goodwill for personal financial gain.

Criminals create an illusion of a legitimate organization by having an official-sounding name, logo, website, greeting, story, or anything else that helps with the deception. There are the fly-by-night organizations that seem to have a legitimate paper trail but are really intended to separate you from your money. These fraudulent charities often pop up after some disaster, either manmade or natural, looking to prey on people’s emotions and desire to help.

Even a charity that has been in operation for a while can still be a scam. Do some sleuthing; a good gumshoe will want to know more facts about the situation. For example, before giving to a charity, one thing worth knowing in advance is how much of your donation goes to “direct support”, the advocacy part that makes an impact versus “administrative costs,” which covers items like operating costs and staff salaries.



How can you double-check if a charity is really a charade?

  1. Search the charity’s name on the world wide web along with words like “scam,” “fraud,” “complaints,” and so forth.
  2. Check the Better Business Bureau to see if they have any records for the organization.
  3. Try the Secretary of State website to see if the charity is currently registered with the state.

Sometimes the organization initiates contact with you, and you might not be able to utilize these options. If you’re on a phone call and are being pressured to donate, remind the caller that there is no need so great that you have to pay right there on the spot. If the caller keeps pestering you, feel free to flex the finger of POWER and use it to hang up on them.

Another option is to ask the representative to send you a written brochure and let them know you look forward to receiving the documents. Asking for information in writing solves a few potential problems. Most immediately, it helps end the phone call. When the documents arrive, you can then review the information at your own pace. A reputable organization believes in their mission and are willing to share that information with you. They will always be happy for your support, even if it arrives a little later. You have the right to choose who you talk and donate to, especially when they call you out of the blue to ask you for your money.


Edge Security

Protect Your Identity with Edge Pay

Monitor your credit and secure your finances with our modern debit card.

Learn more



Here are a few examples of additional red flags to look for that might signal that you’re the target of a scam, whether it’s via call, text, email, social media, or direct mail:

  • How are you being asked to send funds? Are they asking for gift cards to be used, cash to mail, and other payment methods that don’t seem to add up? Remember, it doesn’t matter if you were asked in writing or verbally, it only matters that you were asked.
  • The charity representative becomes hostile and threatening when asking for donations.
  • The messaging is full of errors such as typos, poor grammar, or images not aligned with the text.
  • When searching the Secretary of State website, you are unable to locate the charity as registered or the information doesn’t match.

Ultimately, you’ll need to analyze all the information that you’ve collected about the charity to determine if you want to send financial support (and if so, how much). Ask yourself what assurances you need to feel comfortable having a financial relationship with this charity, and if you are satisfied with the percentage of your donation that will go directly to support your cause.

My approach to giving? When it comes to financial contributions, I identify causes that matter to me and then find groups that mirror my beliefs and values. I like to know how much of my donation is put into service. I also like to know what the operational costs are of the group I’m supporting. Mostly, I prefer to keep my charity support local because if I’m looking to help someone, who better to help than a neighbor?


With that, don’t be afraid to donate to your favorite causes and charities; there are so many incredible, legitimate organizations out there to support. Help when and where you can and remember: we all benefit from being kind to one another.


Worried about Your Credit?

This eBook can help you protect and improve your score.

Download the eBook

About Risk Management Department

Our vision is to empower possibilities for greater prosperity for Vermonters. Part of fulfilling that vision is protecting our members’ accounts against unauthorized access. The security of your personal information is a top priority for VSECU. Are you afraid that your financial information at VSECU has been compromised? Please contact us immediately at 1-800-371-5162. We can help with the process of securing your accounts and may even be able to help mitigate your loss.

Reading on Phone

Stay informed

Stay up to date on financial tips, tricks, and tools that will build your financial literacy and help you live a more prosperous life.

Subscribe now!