Holiday Scams In Disguise: What To Watch Out For When Donating Online

Scammers are always circling around acts of generosity, but during the holiday season—when giving spikes and emotions run high—they become especially aggressive.

In a shocking example, authorities stopped a huge telefunding scam involving 1.3 billion deceptive donation calls, which managed to collect over $110 million from unsuspecting donors. (Federal Trade Commission)

Furthermore, researchers at Cornell University uncovered over 800 social media accounts running donation scams on platforms such as Facebook, X, and Instagram, funneling victims toward fraudulent fundraisers.

For small businesses, even a single mistake in charitable giving can do more than just cost money—it can link your business name to fraud, damage your credibility, and weaken trust with clients, partners, and your community.

Here's your essential guide to thoroughly vetting fundraisers, recognizing warning signs, and safeguarding your business and goodwill this holiday season.

Steps To Vet A Fundraiser Before Making Donations

A trustworthy fundraiser will clearly provide:

• Who is organizing the fundraiser and their relationship to the cause.
• How the funds will be allocated, along with a detailed timeline.
• Who controls the withdrawals and the path funds travel to the intended recipients.
• Public endorsement from close associates of the recipient, such as family or friends.

If any of these details are unclear or missing, request clarification immediately. Silence or evasiveness should raise alarms.

Warning Signs That Typically Indicate Scams

Investigate if you notice:

• False or misleading information presented on the fundraiser's page.
• Funds not being utilized for their stated purpose within a reasonable timeframe.
• Someone impersonating another individual or using copied stories.
• Emotionally manipulative narratives that seem too perfect or exaggerated.

If multiple red flags emerge, report the fundraiser immediately and avoid donating.

How To Scrutinize Charities Beyond Crowdfunding

Even well-known charities can engage in questionable practices. Watch for:

• Clear descriptions of programs, thorough financial reports, and annual transparency.
• Details on how much of donations go directly to programs versus administrative costs.
• Search results associating the charity's name with words like "fraud," "scam," or "complaints."

Missing information or negative feedback should prompt caution.

Common Fraud Tactics Used By Charity Scammers

Stay alert for:

• Requests for donations through gift cards, wire transfers, or cryptocurrency—legitimate charities usually accept credit cards or checks.
• Websites lacking a secure https connection—indicated by the absence of "s"—which means your data isn't protected.
• High-pressure tactics urging you to donate immediately to prevent you from thinking critically.
• Claims that you already committed to a donation when you don't recall doing so—always verify before sending money.

Remember, scammers are sophisticated. Even professional-looking websites and well-written stories can hide harmful intentions.

Why Protecting Your Business Is Crucial

Your company's charitable contributions—whether private or public—become part of your brand identity. Falling victim to donation scams, or having employees contribute through your business name without due diligence, can tarnish your reputation and entangle your company in fraud claims.

Moreover, many tactics used in charity scams—such as pressure tactics, impersonation, and fake websites—are common in broader fraud schemes affecting businesses, including phishing, invoice fraud, and wire transfer scams. Training your team to identify fraudulent fundraisers creates a defense against a wide array of cyber threats.

Practical Steps To Safeguard Your Business And Goodwill

Follow these proven strategies to keep your donations secure and effective:

1. Establish A Donation Policy: Clearly define how, where, and when your company will give, setting approval processes to govern donations.
2. Educate Employees: Train your staff to recognize fake fundraisers and emphasize the importance of verifying causes before donating on behalf of the business.
3. Use Trusted Platforms: Ensure donations go directly through official charity websites, not random links in emails or social media.
4. Ensure Transparency: If your business publicly announces its charitable efforts, verify that the charities you support are legitimate and reputable.
5. Monitor Donations: After donating, track how funds are used—many charities publish reports showcasing their impact.

Keep Your Holidays Full Of Generosity, Not Risk

This holiday season, focus on giving back with confidence rather than regret. Smart vetting and clear policies safeguard your money and protect your business's hard-earned reputation.

Want to empower your team to identify scams—be it fake fundraisers, phishing emails, or fraudulent payment requests?

Contact us at 332-217-0601 or click here to Speak to an Expert today.

Because the greatest gift you can offer your business and community is trust that lasts.