This Holiday Season, Make Sure Your Good Deeds Go to the Right People

~ By Gerald Rome, Colorado Securities Commissioner ~

It’s hard to believe, but another holiday season is upon us. 2016 has surely been a tumultuous year, and one where many worthwhile causes have arisen to help those in need here in Colorado as well as around the world. The holidays are a popular time to give thanks for our blessings, and recognize that there are others less fortunate. While many legitimate charities and non-profits see an influx of donations at this time of year, unfortunately it also means that we in the regulatory business hear more reports of fake charities that scam innocent do-gooders as well as truly needy recipients out of donations. It’s terrible to think that a donation made by someone with good intentions ends up not in the hands of the needy, but lining the pockets of a greedy and intensely immoral scam artist.

Gerald Rome, Colorado Securities Commissioner

Gerald Rome, Securities Commissioner

These scams don’t only affect people who give money by check, credit card, or cash. It’s becoming more and more popular for people with limited liquid assets to gift in-kind supplies or securities to charities. Even though these donations may be harder for scammers to access, don’t be fooled into thinking that they won’t try. Make sure that before you write a check, hand over goods, or sign over a bond to a non-profit, you review these tips to help ensure that your money goes to a truly worthy cause.

  • Do your homework. Especially if you have been contacted directly by a charity, make sure you research them online. Run a search for “complaints” along with the non-profit name to see if there have been any reports of fraudulent behavior.
  • Never send cash or wire money to a charity. If they ask you to contribute in this way it should raise a red flag.
  • Never send a donation to a non-profit claiming you’ll be entered into a sweepstakes. It is prohibited by law to require a donations in order to make someone eligible for a prize.
  • Be particularly wary of charities that follow headline-making news. In times of crisis, it’s better to give to established charities that will be accountable for what they do with the donations.
  • Take time to think about your donation. If someone is putting pressure on you to give right now, it’s best to walk away and tell them you’ll do research before giving. This can be particularly difficult with door-to-door solicitors, but just ask them for a pamphlet and a way to contact them later.
  • Never give your financial information over to a person or charity before thoroughly vetting and establishing the legitimacy of the organization.
  • Finally, if you think you’ve been contacted or have given money to a fraudulent charity operation, make sure you file a report. DORA can provide you with resources to make a report, or you can contact the Colorado Attorney General’s Office.

This holiday season, resolve to keep your investments – and donations – safe. If you have doubts about the legitimacy of a charity, contact us at (303) 894-2320 or the Colorado Attorney General’s Consumer Fraud Line at (800) 222-4444. Remember, it only takes a few minutes to verify that the charity you choose this holiday season is worth your generosity!