November 17, 2025
Scammers often prey on generosity, even during stable times. However, the holiday season, with its surge in giving and heightened emotions, sees these fraudsters become particularly aggressive.
In a stark example from a few years back, authorities dismantled a massive telefunding scam that had executed over 1.3 billion deceptive donation calls and illicitly gathered more than $110 million from trusting donors. (Federal Trade Commission)
Research from Cornell University highlighted that on social media platforms alone, more than 800 accounts were orchestrating donation frauds, steering victims toward fraudulent fundraisers on sites like Facebook, X, and Instagram.
For small businesses, a single mistake in charitable contributions can cause severe consequences—losing money is just the start. It can entangle your business's reputation in fraud, damage relationships with clients and partners, and harm your standing in the community.
Follow these guidelines to verify fundraisers, detect warning signs, and ensure both your business and goodwill remain protected this season.
Essential Steps to Vet a Fundraiser Before Donating
A trustworthy fundraiser should provide clear answers to:
- Who is behind the fundraiser, and what is their relationship to the beneficiary?
- How exactly will the funds be allocated, and what is the timeline for their use?
- Who manages fund withdrawals, and is there a transparent process ensuring the money reaches its intended purpose?
- Do family members or close friends publicly endorse the campaign?
If any information is unclear or missing, request clarification promptly. Evasive responses or silence are definite red flags.
Recognizing Red Flags That Signal Scam Fundraisers
Be cautious and research further if you encounter:
- False or misleading statements on the fundraiser's webpage
- Funds not being directed to the stated cause within a reasonable timeframe
- Impersonation of legitimate individuals or theft of genuine stories
- Overly perfect or emotionally manipulative narratives
Spotting several of these indicators means it's safer to report the fundraiser and decline to donate.
How to Scrutinize Charities Beyond Crowdfunding
Even reputed charities might engage in questionable practices. Watch for:
- Clear, detailed descriptions of programs, financial statements, and annual reports
- Transparent breakdowns showing what portion of donations fund programs versus administrative overhead
- Negative search results using terms like "fraud," "scam," or "complaints" alongside the charity's name
Any gaps in detail or negative feedback should raise your skepticism.
Common Strategies Used by Charity Scammers
Be alert for these tactics:
- Requests for donations via gift cards, wire transfers, or cryptocurrencies — legitimate charities typically accept credit cards or checks.
- Websites lacking https in their URL, indicating insecure data transfer.
- Pressure to donate immediately — scammers use urgency to prevent careful consideration.
- Claims that you previously pledged or donated when you don't recall doing so — always verify before giving.
Even the most professional websites and compelling headlines can disguise fraudulent schemes.
Why Charitable Giving Impacts Your Business
Your business's generosity, whether publicized or not, is part of its identity. Donating to a scam—intentionally or inadvertently—or employees giving on behalf of your company can entangle your brand in fraudulent stories.
Moreover, the techniques scammers use in charity fraud—such as urgency, impersonation, and fake websites—are often deployed against businesses too, manifesting as phishing, invoice fraud, and wire transfer scams. Training your team to identify fake fundraisers equips them to recognize fraud attempts in many contexts.
How to Safeguard Your Business and Its Goodwill
Follow these practical steps to make your charitable giving secure and intentional:
- Create a Donation Policy for Your Business: Establish clear guidelines about where and how donations are made, including approval processes.
- Educate Employees: Train your team to recognize fake fundraisers and encourage verification before donating under your business's name.
- Use Verified Donation Channels: Always donate through official charity websites rather than clicking on unexpected email or social media links.
- Maintain Transparency: If your business publicly promotes its donations, ensure the charity is genuine and reputable.
- Monitor Donations Post-Giving: Follow up to confirm funds are used as promised; many charities publish impact reports for this purpose.
Giving Generously Without Risk This Holiday Season
The holiday season is meant for thoughtful giving, not for facing regret. By implementing careful checks and well-defined policies, you protect both your financial contributions and your valued reputation.
Want your team to master spotting scams—whether fake fundraisers, phishing emails, or fraudulent payment requests?
Contact us at 858-202-0304 or click here to book your free 15-Minute Discovery Call today.
Because the greatest gift you can offer your business (and community) is unshakable trust.
