BBB advises: Be generous, but give wisely

(Previously posted Nov. 22)

[December 05, 2013]  PEORIA — The tornadoes that struck central Illinois last weekend have gained worldwide attention. Generous donors wishing to help the victims are being cautioned by the Better Business Bureau to confirm the legitimacy of all charitable fundraising and crowdfunding efforts.

"A tragedy of this nature that is the focus of high-profile media attention inspires people to give," says Jessica Tharp, vice president of BBB Heart of Illinois, "but, unfortunately, also catches the attention of scammers who try to take advantage of well-meaning generosity."

BBB Wise Giving Alliance has seen charity scams following all recent natural disasters and man-made tragedies, and encourages donors to balance their generosity with thoughtfulness and research.

"Try to avoid making emotional giving decisions," says H. Art Taylor, president and CEO of the BBB Wise Giving Alliance, "The first request for a donation may not be the best choice. Check with the BBB to help avoid questionable fundraising efforts."

BBB also reminds consumers that donations made through crowdfunding websites are usually considered gifts to the recipients and are not tax-deductible unless the group receiving the funds is a 501(c)(3) organization as designated by the Internal Revenue Service.

BBB urges consumers to make wise choices with their donations:

• Respond thoughtfully. 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.

• Respect the victims and their families. Organizations raising funds should get permission from the families to use the names of the victims or any photographs of them. For example, some charities raising funds for the Colorado movie theater and Newtown school victims did not do this and were the subject of criticism from victims' families.

• Registration confirmation. 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 significant red flag.

• Results should be shared. 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 and individuals 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.

• Retail sale disclosures. If any items are being sold (such as T-shirts, etc.) in the context that their sales will benefit the victims, look for a disclosure that states the actual or anticipated amount of the purchase that will benefit the a specified charity and, if applicable, any minimums or maximums being raised (e.g., up to $100,000) as well as campaign term limits (e.g., during the month of November).

• Remember online giving cautions. Never click on links to charities on unfamiliar websites or in texts or emails. These may take you to a look-alike website where you will be asked to provide personal financial information or to click on something that downloads harmful malware into your computer. Don't assume that charity recommendations on Facebook, blogs or other social media have already been vetted.
  
  Also, websites that enable individuals to raise funds (known as crowdfunding sites) can be established very quickly but may not have oversight procedures in place to ensure that funds will be used as promised (for example, establishing a CPA, bank or other respected third party to receive collected donations and help distribute funds to victims).

• Review BBB reports on charities. Find out if the subject charity meets the 20 BBB "Standards for Charity Accountability." Visit give.org for reports on nationally soliciting charities and bbb.org for information on regionally soliciting organizations.

[Text from file received from the Better Business Bureau of Central Illinois]

For 100 years, the Better Business Bureau has been helping consumers find businesses, brands and charities they can trust. In 2012, consumers turned to BBB more than 100 million times for reviews on more than 4 million companies and reports on 11,000 charities, all available for free at www.bbb.org. The Council of Better Business Bureaus is the umbrella organization for 114 local, independent BBBs across the United States and Canada, as well as home to its national programs on dispute resolution and industry self-regulation.