November 16, 2025
Scammers are always lurking around acts of kindness, but they become especially opportunistic during the holiday season when generosity peaks and emotions run high.
In a major crackdown a few years ago, authorities uncovered a telefunding scheme involving an astonishing 1.3 billion deceptive donation calls that defrauded donors of more than $110 million. (Federal Trade Commission)
Meanwhile, researchers at Cornell University identified over 800 fraudulent social media accounts running donation scams on platforms like Facebook, X, and Instagram, steering victims towards sham fundraisers.
For small businesses, a single mistake in charitable donations can cost more than money—it can associate your brand with fraud, tarnish your reputation, and break the trust of your clients, partners, and community.
Here's your essential guide to thoroughly vetting fundraisers, recognizing warning signs, and safeguarding your business and its goodwill during this giving season.
Effective Ways To Vet A Fundraiser Before Donating
Legitimate fundraisers should provide clear answers to these questions:
- Who is managing the fundraiser, and what is their relationship to the beneficiary?
- How will the donations be utilized, and what is the timeline for use?
- Who controls the disbursement of funds? Is there a transparent process ensuring funds reach their intended destination?
- Are there confirmations of support from close contacts such as family or friends?
If any details are unclear or missing, demand clear clarification — silence or evasiveness is a major red flag.
Common Warning Signs of Fundraising Scams
Watch out for these indicators and pause to investigate:
- Inaccurate or misleading statements on the fundraiser's page.
- Funds not being allocated promptly and for the declared purpose.
- Impersonation or copying of another person's story.
- Excessively perfect or emotionally manipulative narratives.
If you find several red flags, report the fundraiser immediately and avoid donating.
Thoroughly Vetting Charities Beyond Crowdfunding
Established charities can sometimes engage in questionable practices, so keep an eye out for:
- Clear program descriptions, detailed financial reports, and accessible annual statements.
- Transparent breakdowns showing how much of each donation supports programs versus administrative costs.
- Search results linking the charity's name to terms like "fraud," "scam," or "complaints."
Lack of transparency or negative feedback should raise an immediate warning.
Typical Scammer Tactics To Recognize
Be cautious of the following practices:
- Requests for donations via gift cards, wire transfers, or cryptocurrencies—legitimate organizations accept credit cards or checks.
- Websites lacking secure HTTPS encryption, indicated by a missing "s" in the URL.
- Urgent demands to donate immediately—this pressure tactic is designed to hinder rational decision-making.
- Claims that you already pledged or donated without your recollection—always verify before sending funds.
Remember, scammers are cunning; even polished websites and well-crafted messages can mask malicious intent.
Why This Matters to Your Business
Your company's charitable giving, whether public or private, reflects directly on your brand. Donating to scams, or employees donating in your company's name without oversight, can entwine your reputation with fraud.
Moreover, the deceptive techniques used in charity scams—false urgency, impersonations, fake websites—are also employed in phishing, invoice fraud, and wire scams targeting businesses. Equipping your team to recognize fraudulent fundraisers strengthens their ability to identify deception across the board.
Protecting Your Business and Its Generosity
Follow these steps to keep your donations safe and strategic:
- Establish a Clear Donation Policy: Set guidelines for how your business donates, including approval procedures.
- Educate Employees: Train your team to question and verify fundraisers before donating in your company's name.
- Use Verified Platforms: Always donate directly through official charity sites rather than unknown links in emails or social media.
- Maintain Transparency: Verify charities if your business publicly announces its donations.
- Monitor Donations: Follow up to confirm that donated funds are used as intended, as many charities publish impact reports.
Enjoy a Generous, Risk-Free Holiday Season
The holidays should be a time for giving without regret. Implementing smart checks and solid policies protects your funds and your business reputation.
Looking to empower your team to spot scams—whether fake fundraisers, phishing emails, or fraudulent payment requests?
Contact us at 1300 136 410 or click here to schedule your free 15-Minute Discovery Call today.
Because the greatest gift you can give your business and community is unshakable trust.
