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

Scammers are always on the lookout to exploit your generosity, especially during the holiday season when kindness and giving surge.

Not long ago, law enforcement dismantled a massive telefunding scam that involved making 1.3 billion fraudulent donation calls and scamming over $110 million from generous donors. (Federal Trade Commission)

Meanwhile, researchers from Cornell University uncovered that over 800 social media accounts run donation scams, coaxing people into fake fundraisers on platforms like Facebook, X, and Instagram.

For small businesses, one wrong charitable move can have severe consequences — not only financial loss but also tarnishing your company's reputation and shaking the trust of customers, partners, and your community.

Follow these expert tips to carefully vet fundraisers, identify warning signs, and protect both your business and your goodwill this holiday season.

Essential Steps to Vet a Fundraiser Before Donating

A trustworthy fundraiser should clearly provide answers to these key questions:

• Who is organizing this fundraiser, and what is their connection to the beneficiary?
• What is the intended use of the funds, and what is the timeline for their allocation?
• Who manages withdrawals? Is there a transparent and secure process to ensure funds reach the intended party?
• Are close contacts (family or friends) of the recipient publicly endorsing the campaign?

If any responses are unclear or omitted, request clarification immediately. Silence or evasive behavior is often a red flag.

Warning Signs to Detect Potential Scams

Stay alert for these indicators; if you notice any, pause and investigate further:

• False or misleading information presented on the fundraiser page.
• Funds not being allocated to the stated purpose within a reasonable timeframe.
• Impersonation of individuals or theft of someone else's story.
• Fundraiser narratives that seem overly perfect or manipulate emotions excessively.

If you detect multiple red flags, it's best to report the fundraiser and avoid donating.

How to Vet Established Charities (Beyond Crowdfunding)

Even well-known charities may have questionable practices. Look for these signs:

• Clear program descriptions, detailed financial reports, and annual transparency documents.
• Explicit breakdowns showing what percentage of donations directly fund programs versus overhead costs.
• Charity names appearing alongside terms like "fraud," "scam," or "complaints" in online searches.

Any missing information or negative feedback should prompt you to exercise extreme caution.

Typical Scammer Tactics in Charity Frauds

Be wary of these common methods fraudsters use to deceive donors:

• Requests for donations via gift cards, wire transfers, or cryptocurrencies — legitimate charities typically accept only credit cards or checks.
• Websites lacking HTTPS encryption (look for the "s" in the URL), which means your data isn't secure.
• Pressure tactics demanding you donate immediately — urgency is used to cloud your judgment.
• Claims that you already pledged or donated when you don't recall doing so — always verify before paying.

Remember, scammers can construct professional-looking websites and compelling stories; always dig deeper before trusting.

Why Protecting Your Business from Charity Scams Matters

Your company's charitable donations—whether public or private—reflect on your brand identity. A misstep in giving can link your business to fraudulent activity, causing reputational harm.

Even more concerning, fraudsters use similar techniques seen in charity scams—such as impersonation, fake urgency, and fraudulent websites—to target businesses through phishing and payment scams. Training your team to identify fake fundraisers also strengthens their ability to recognize broader fraudulent tactics.

Strategies to Safeguard Your Business and Preserve Goodwill

Adopt these measures to ensure your company's charitable giving is responsible and secure:

1. Develop a Clear Donation Policy: Set guidelines on how and where donations are approved, including spending limits and authorization steps.
2. Educate Your Team: Train employees to recognize fake fundraisers and verify legitimacy before donating on behalf of the company.
3. Donate Through Trusted Platforms: Use official charity websites rather than random email links or social media posts.
4. Maintain Transparency: When publicizing your donations, confirm the charity's authenticity to protect your brand's reputation.
5. Monitor Donations Post-Giving: Follow up to ensure funds are used as promised; many charities release impact or financial reports.

Keep Holiday Giving Generous, Not Risky

The holiday season is an opportunity to give back wisely. Implementing thorough checks and solid policies protects both your finances and your reputation.

Want your team equipped to recognize scams—from fake fundraisers to phishing emails and fraudulent payment requests?

Contact us at (918) 770-9150 or click here to book your free 15-Minute Discovery Call today.

Because the most valuable gift you can give your business and community is unshakable trust.