Tom DotyTimes Columnist
July 3, 2013
Better Business Bureau (BBB) joins the nation in mourning the loss of the Arizona Firefighters in the Yarnell Hill Fire. To ensure donations get into the right hands, BBB offers advice on charitable giving in the wake of this tragedy.
“Tragedies like this one, the Newtown School shooting, and Boston Marathon bombings bring out scam artists,” says BBB President/CEO Charlie Mattingly. “Americans want to help the victims’ families and community through donations.”
BBB warns, while there will be legitimate organizations and individuals soliciting donations, there will also be those who are dishonest, with no intention of getting the donations to the victims.
BBB advises the public to consider the following wise giving tips before responding to a phone call, door-to-door, email, text message, or social media post soliciting donations:
1. Thoughtful Giving — Take the time to 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. Be proactive and find trusted charities that are providing assistance.
2. Spread the Wise-Giving Word — Remind friends and family to be cautious about giving requests in the wake of such a tragedy and ask them to spread the word as well. People are emotionally moved by events like these and may react before they have time to carefully consider.
3. State Government Registration — 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 for charitable gifts. If the charity is not registered, that may be a red flag.
4. Respecting 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 and Newton school victims did not do this and were the subject of criticism from victims’ families.
5. How Will Donations Be Used? — Beware of 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.
6. What if a Family Sets Up Its Own Assistance Fund? — Some families may decide to set up their own assistance funds. These funds may not be set up as charities. 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.
7. Online Cautions — Never click on links to charities on unfamiliar websites or in texts or emails. These may take you to a lookalike website where you will be asked to provide personal financial information or click on something that downloads harmful malware onto your computer. Don’t assume charity recommendations on Facebook, blogs, or other social media sites have already been vetted.
8. Financial Transparency — After funds are raised for a tragedy, it is even more important for organizations to provide an accounting of how funds were spent. Transparent organizations will post this information on their websites so that anyone can find out and not have to wait until the audited financial statements are available sometime in the future.
9. Newly Created or Established Organizations — Consider that 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 mean well, but will be difficult to research.
10. Tax Deductibility — 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 non-registered entities, but should keep in mind, if they want to take a deduction for federal income tax purposes, they will not be able to. In addition, contributions that are donor-restricted to help a specific individual/family are not deductible as charitable donations, even if the recipient organization is a charity.
BBB’s Wise Giving Alliance - provides free, reliable information on national charities at give.org.