Scammers are drawn to generosity, and during the holiday season, when surges and emotions run high, they thrive.
A few years ago, one of the largest telefunding scams in history was shut down after the perpetrators made 1.3 billion deceptive donation calls, collecting over $110 million from unsuspecting donors.
At the same time, researchers at Cornell University found that over 800 fraudulent accounts operated across platforms like Facebook, Instagram, and X, promoting fake fundraisers designed to prey on good intentions.
For small businesses, donating to a fake charity can cost more than money. It can link your name to fraud, damage your reputation, and erode trust with clients, partners, and your community.
Before your business gives back this season, take a moment to protect your generosity.
How to Check if a Fundraiser is Legit
Any legitimate fundraiser should clearly answer these questions:
- Who is organizing this, and what’s their relationship to the recipient?
- How will the funds be used, and over what timeframe?
- Who controls the money? Is there a clear path for funds to reach the intended recipient?
- Do people close to the recipient (family, friends, colleagues) publicly support the campaign?
If the answers are unclear, missing, or evasive, that’s your first red flag.
Warning Signs of a Scam
Pause and investigate if you notice:
- Misleading or false details on the fundraising page
- Funds not being used as stated, even after a reasonable period
- Impersonation or use of someone else’s story or images
- Stories that seem overly dramatic, “too perfect,” or emotionally manipulative
If more than one of these shows up, don’t donate, and consider reporting the campaign.
How to Check if a Charity is Legit
Even established charities deserve a second look. Here’s how to make sure your donation is going to the right place:
- Read the fine print. A trustworthy organization will clearly explain what they do, where the money goes, and what kind of impact they’re making.
- Check the numbers. See how much of your donation actually supports the cause, not just salaries and overhead.
- Do a quick search. Look up the charity’s name with words like “scam,” “complaints,” or “reviews.” You might be surprised by what turns up.
If the details are vague, or if you find red flags, consider choosing a different organization. A familiar name doesn’t always mean it’s above board.
Some Common Tactics Fraudsters Use
Below are some of the red flags that you should watch out for in any donation request:
- Payment request via gift cards, wire transfers, or cryptocurrency
- Websites that lack https encryption
- Pressure to “act now” or donate immediately
- Claims that you’ve already donated, hoping you won’t question it
Note: Most scammers use sophisticated language, polished websites, and fake endorsements to appear legitimate.
Why It Matters to Your Business
When your business donates, whether publicly or behind the scenes, it reflects on your brand. A well-intentioned donation to a fraudulent campaign can cause real damage.
Even worse? The same tricks used in donation scams, urgency, impersonation, fake websites, are often used in business-targeted scams like phishing, invoice fraud, or vendor impersonation. Teaching your team to spot fake fundraisers trains them to recognize broader threats as well.
Protect Your Business (and Your Generosity)
A few simple steps can help make sure your holiday giving is both safe and meaningful:
- Set a clear giving policy. Decide in advance how your business selects causes to support, and who needs to approve donations.
- Keep your team informed. Make sure employees know how to spot fake fundraisers, especially if they’re donating in your company’s name.
- Stick to trusted sources. Avoid donating through random links in emails or on social media. Go directly to the charity’s official website.
- Be open about who you support. If your business shares its charitable efforts publicly, double-check that the organization is credible.
- Check in after giving. Reliable charities usually provide updates, reports, or thank-yous. It’s a good way to confirm your donation is being used well.
The holiday season is a time to give, not a time to get scammed.
With a little due diligence and clear policies, your business can give confidently, protect its reputation, and strengthen the trust you’ve built in your community.
Want to train your team to recognize fake fundraisers, phishing emails, and payment fraud? Book a free discovery call here
