November 17, 2025
Scammers lurk around generosity, especially during the holiday season when giving peaks and emotions run high, making it a prime time for fraud.
Consider a massive telefunding scam shut down a few years ago after authorities uncovered 1.3 billion fraudulent donation calls leading to over $110 million in illicit funds collected from well-meaning donors. (Federal Trade Commission)
Additionally, a study by Cornell University researchers revealed that over 800 social media accounts engaged in donation scams on platforms such as Facebook, X, and Instagram, directing victims to counterfeit fundraisers.
For a small business, even a single misstep in charitable donations could cost more than money — it may harm your brand's integrity, erode client and partner trust, and mar your community reputation.
Discover how to carefully evaluate fundraisers, identify warning signals, and safeguard your business and goodwill this holiday season.
Steps to Verify a Fundraiser Before Contributing
A reputable fundraiser should provide clear answers to these questions:
- Who is running the fundraiser, and what is their relation to the beneficiary?
- How will the donations be allocated, and what is the expected timeline?
- Who manages the withdrawals? Is there a transparent process to ensure funds reach the intended recipients?
- Do close family or friends openly endorse the campaign?
If any information is unclear or missing, request additional details. Lack of response or evasiveness is a warning sign.
Common Red Flags Indicating Potential Scams
Remain cautious and investigate if you encounter:
- Fundraiser pages with misleading or blatantly false details
- Donations that fail to be used for the stated cause within a reasonable period
- Impersonation or reproduction of someone else's story
- Stories that appear overly polished or rely heavily on emotional manipulation
Spotting multiple red flags? Report the fundraiser immediately and avoid donating.
Evaluating Charities: Beyond Crowdfunds
Even trusted charities can have questionable practices. Watch for:
- Detailed program descriptions, clear financial reports, and annual disclosures
- Transparency about the portion of donations used directly for programs versus overhead costs
- Online search results associating the charity's name with terms like "scam," "fraud," or "complaints"
Insufficient details or negative feedback should trigger caution.
Typical Tricks Used by Charity Scammers
Be alert for these tactics:
- Requests for donations through gift cards, wire transfers, or cryptocurrency — legitimate charities typically accept credit cards or checks.
- Websites lacking "https" in the URL, indicating unsecure data transmission.
- High-pressure tactics urging you to donate immediately to prevent second thoughts.
- Unexpected claims that you previously pledged or donated; always verify before giving.
Scammers can craft polished websites and convincing headlines that mask malicious intent.
The Importance of This Guidance for Your Business
Your company's charitable actions, public or private, reflect on your brand identity. Contributing to a scam or having an employee donate under your company name can entangle your brand in fraud controversies.
Furthermore, scammers targeting charities often use tactics similar to those in phishing, invoice fraud, and wire transfer scams. Training your team to detect fake fundraisers also fortifies your defenses against broader fraud threats.
Protecting Your Business and Its Goodwill
Follow these measures to ensure your donations are secure and effective:
- Create a Donation Policy: Set clear guidelines on donation destinations and approval limits within your company.
- Educate Employees: Inform your team about fraudulent fundraisers and stress verifying legitimacy before donating as representatives of your business.
- Use Reliable Platforms: Always donate through official charity websites rather than clicking random links in emails or social media.
- Maintain Transparency: When publicly announcing donations, confirm the legitimacy of the supported charity.
- Monitor After Donation: Follow up to ensure funds are used as promised, benefitting from many charities' published impact reports.
Ensure Your Holidays Are Generous and Secure
The holiday season is an opportunity for giving—not regret. Implementing smart checks and policies protects both your funds and your business's reputation.
Want your team well-equipped to identify scams, from fake fundraisers to phishing emails and fraudulent payment requests?
Call us at 866-523-2985 or click here to book your complimentary 15-Minute Discovery Call today.
Because the greatest gift to your business and community is an unbreakable foundation of trust.
