November 17, 2025
Scammers lurk around generosity all year, but the holiday season, with its surge in giving and heightened emotions, is when they strike hardest.
Several years ago, authorities dismantled a massive telefunding scam that had made an astonishing 1.3 billion deceptive donation calls, fraudulently collecting over $110 million from unsuspecting donors. (Federal Trade Commission)
Meanwhile, researchers at Cornell University uncovered more than 800 social media accounts running donation scams, steering victims to fake fundraisers on platforms like Facebook, X, and Instagram.
For small businesses, one mistake in charitable giving can be costly—not just financially but also by associating your business with fraud, harming your reputation, and breaking trust with clients, partners, and your community.
Discover how to thoroughly vet fundraisers, identify warning signs, and keep your business and its goodwill safe during the holiday season.
How to Properly Vet a Fundraiser Before Donating
Every legitimate fundraiser should clearly address these key questions:
- Who is organizing this fundraiser, and what is their relationship to the beneficiary?
- How will the funds be specifically used, and what is the timeline for their use?
- Who is in charge of managing withdrawals and ensuring the money reaches its intended purpose?
- Are the recipient's close contacts (family, friends) publicly supporting and endorsing the campaign?
If any answers seem unclear or missing, seek clarification immediately. Avoid silence or evasiveness, as these are strong red flags.
Key Red Flags That Often Reveal Scams
Be cautious and investigate further if you encounter:
- Fundraiser pages with misleading or outright false details
- Funds not being used as promised within a reasonable timeframe
- Impersonation of others or copied stories
- Stories that feel overly perfect or designed to manipulate emotions
Spotting multiple red flags? Report the fundraiser and do not contribute.
How to Vet Charities Beyond Crowdfunds
Even established charities can have questionable practices. Look out for:
- Clear program descriptions, transparent financial reports, and annual disclosures
- Information about the ratio of donations going to programs versus administrative costs
- Charity names surfacing in searches alongside terms like "fraud," "scam," or "complaints"
Lack of details or negative feedback should raise concerns.
Common Tricks Employed by Charity Scammers
Watch for these tactics:
- Requests for donations via gift cards, wire transfers, or cryptocurrency—legitimate charities typically accept credit cards or checks.
- Websites lacking https, indicating insecure data transmission.
- Urgent pressure to donate immediately—this tactic aims to prevent you from fully considering your decision.
- Claims that you previously pledged or donated without recalling—always verify your history before proceeding.
Even sophisticated websites and professional-sounding pitches can mask harmful scams.
Why This Matters for Your Business
Your business's donations—whether public or private—become part of its brand identity. A donation to a fraudulent cause or employee donations made under your company's name can entangle your brand in scam controversies.
Moreover, the same deceptive tactics used in charity fraud—urgency, impersonation, fake websites—are also common in targeting businesses through phishing, invoice fraud, and wire transfer scams. Training your team to recognize fake fundraisers equips them to spot broader fraudulent threats.
Safeguarding Your Business and Its Goodwill
Follow these essential steps to ensure your charitable giving is secure and effective:
- Establish a Corporate Donation Policy: Define clear guidelines on where and how your business donates, including required approval levels.
- Educate Employees: Teach your team to recognize fake fundraisers and insist on verification before donating on behalf of your company.
- Use Trusted Donation Channels: Make contributions directly through verified charity websites—not via random email or social media links.
- Maintain Transparency: Verify any charity your business publicly supports, ensuring your goodwill is genuinely well placed.
- Monitor Donations: After giving, track how donations are utilized—many reputable charities publish detailed impact reports.
Celebrate a Season of Generous, Risk-Free Giving
The holidays are about giving back—make sure your generosity brings only positive outcomes. Smart checks and policies protect your funds and your reputation.
Looking to empower your team to recognize scams—be it fake fundraisers, phishing emails, or fraudulent payment requests?
Contact us at 281-402-2620 or click here to schedule your free 15-Minute Discovery Call today.
Because the most valuable gift you can offer your business and your community is unshakable trust.
