DAYTON, OHIO, December 20, 2012 – After the shooting at Sandy Hook Elementary School in Newtown, Connecticut last week, your Better Business Bureau encourages people to lend their support to victims. But, it advises people to do so wisely. Your BBB says look out for potential red flags in fund raising to help Newtown and be aware of the different circumstances that often emerge in tragedy-related philanthropy.
John North, BBB president and CEO, says, “The nation is grieving the loss of life we witnessed last week in Newton. And, many of us want to reach out and lend our support to the victims. But, as with every crisis, scammers pop up to take advantage of our generosity, making it important for donors to do their homework before they give.”
Your BBB offers ten tips to help you give with confidence:
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. Find trusted charities that are providing assistance. One way to check them out is to contact your BBB for a report on the organization. Visit www.bbb.org or call (937) 222-5825 or (800) 776-5301.
Determine if the charity is registered with the state. 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.
Be sure the organization is being respectful of the victims and their families. 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 victims didn’t do this and were the subject of criticism from victims’ families.
Ask how your donation will be used. 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.
Be mindful that such funds set up by the families for assistance may not be set up as charities. Also, make sure 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.)
Keep in mind tragedies involving firearms can also generate requests from a variety of advocacy organizations addressing gun use. Donors can support these efforts as well, but note some of these advocacy groups aren’t tax exempt as charities. Also, watch out for newly created advocacy groups that will be difficult to check out.
Never click on links to charities on unfamiliar Web sites or in texts or e-mails. These may take you to a lookalike Web site where you’ll be asked to provide personal financial information or to click on something that downloads harmful malware into your computer. Don’t assume charity recommendations on Facebook, blogs or other social media have been vetted.
Make sure the organization’s use of funds is transparent. Transparent organizations will post an accounting of how funds were spent on their Web sites so anyone can find out and not have to wait until the audited financial statements are available in the future.
Make a personal giving choice regarding whether to support newly created or established organizations. 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 be well-meaning, but will be difficult to check out and may not be well managed.
Remember 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 these other entities, but keep this in mind if they want to take a deduction for federal income tax purposes. In addition, contributions that are donor-restricted to help a specific individual/family aren’t deductible as charitable donations, even if the recipient organization is a charity.
About Your BBB Serving Dayton and the Miami Valley
For 100 years, your Better Business Bureau has been helping people find businesses, brands and charities they can trust. In 2011, people turned to your BBB more than 100 million times for Business Reviews on more than 4 million companies and Charity Reports on 11,000 charities, all available for free at www.bbb.org. Today, there are 114 local, independent BBBs across the United States and Canada. To further promote trust, your BBB also offers complaint and dispute resolution support for consumers and businesses when there is difference in viewpoints.