November 17, 2025
Scammers often prey on generosity, especially during the holidays when giving is at its peak and emotions are heightened. This season, it's more important than ever to stay vigilant.
In a shocking case a few years back, authorities uncovered a massive telefunding scam involving 1.3 billion fraudulent donation calls that swindled over $110 million from trusting donors. (Federal Trade Commission)
Researchers from Cornell University also discovered that on social media alone, more than 800 accounts engaged in donation scams, duping users into giving to fake fundraisers on platforms like Facebook, X, and Instagram.
For a small business, accidentally supporting a fraudulent fundraiser can cause far more damage than financial loss—it can associate your company's name with fraud, harm your reputation, and erode trust among clients, partners, and your wider community.
To protect your business and goodwill this holiday season, here's a guide on evaluating fundraisers, detecting warning signs, and ensuring your donations are safe.
Steps to Vet a Fundraiser Before Donating
A trustworthy fundraiser should provide clear answers to these questions:
- Who is organizing the campaign, and what is their relationship to the beneficiary?
- How will the funds be utilized, and what is the expected timeline?
- Who manages fund withdrawals? Is there a transparent route ensuring money reaches its intended cause?
- Do close family or friends publicly endorse the campaign?
If any answers are unclear or incomplete, request further details. Avoid fundraisers that respond with silence or avoidance—these are major red flags.
Warning Signs That May Indicate Scams
Watch for these indicators and pause to investigate before donating:
- Deceptive or blatantly untrue information presented on the fundraiser's page
- Funds not being allocated to the stated cause within a reasonable timeframe
- Impersonation of someone else or plagiarizing another person's story
- Appealing to emotions too perfectly or using manipulative storytelling
If multiple red flags appear, report the fundraiser and refrain from donating.
Evaluating Charities Beyond Crowdfunding
Even well-known charities can have questionable practices. Look for these signs to assess legitimacy:
- Clear program descriptions, detailed financial statements, and annual reports
- Transparency about how much of your donation supports programs versus administrative costs
- Online searches that don't associate the charity's name with "fraud," "scam," or "complaints"
Absence of detailed information or negative feedback should prompt caution.
Common Strategies Used by Charity Scammers
Be cautious if you encounter:
- Requests to donate via gift cards, wire transfers, or cryptocurrency—reputable charities typically accept credit cards or checks.
- Websites lacking HTTPS security (look for the "s"), which indicates an unsafe site.
- Pressure tactics demanding immediate donations to rush your decision-making.
- Claims that you previously pledged or donated when you have no recollection—always verify before paying.
Remember, scammers can create professional-looking sites and compelling headlines that mask deceitful intentions.
Why Protecting Your Business Matters
Your business's charitable giving—whether public or private—shapes your brand identity. Contributing to a scam, or an employee donating in your company's name without verification, could link your reputation to fraud.
Moreover, tactics scammers use in charity fraud—such as urgency, impersonation, and fake websites—overlap with phishing, invoice fraud, and wire transfer scams targeting businesses. Training your staff to identify fake fundraisers helps build a defense against broader fraudulent schemes.
How to Safeguard Your Business and Reputation
Follow these steps to ensure your charitable efforts are secure and wise:
- Establish a Donation Policy: Outline where and how donations are made and implement approval processes.
- Educate Your Team: Inform employees about fake fundraisers and encourage verification before donating on behalf of your company.
- Use Reliable Channels: Donate directly through official charity websites, avoiding unverified email or social media links.
- Maintain Transparency: If you announce your donations publicly, ensure the chosen charities are legitimate and reputable.
- Monitor Impact: Follow up to confirm your donations are used as intended; many charities provide impact reports.
Keep Your Holidays Generous, Not Risky
The holiday season is perfect for giving back, not causing future regret. Implementing smart safeguards preserves both your funds and your company's reputation.
Want your team equipped to recognize scams—whether fraudulent fundraisers, phishing emails, or fake payment requests?
Call us at 1-310-798-0405 or click here to schedule your free 15-Minute Discovery Call today.
After all, the most valuable gift you can give your business and community is unshakable trust that stands firm.
