Thursday, May 21, 2009

Fighting Charity Fraud

from the Miami Herald
National effort fights charity fraud

Do your homework before donating money to a charity claiming to collect money to help police, firefighters or military veterans, the Florida attorney general's office warned Wednesday.
Florida joined a national effort to fight fraud committed by groups claiming to collect money on behalf of protection agencies and veterans, but they give misleading information about how much of the money would actually be given to those groups.

''Operation False Charity'' includes 76 actions against 32 fundraising companies, 31 individuals and 22 nonprofits -- or groups claiming to be nonprofits. The effort is led by the Federal Trade Commission, 61 attorneys general, secretaries of state and other law enforcers in 48 states and the District of Columbia.

The FTC says the money collected was used overwhelmingly to support the charity administration, not the causes they said they were collecting for. Among the organizations targeted: American Veterans Relief Foundation Inc., Coalition of Police and Sheriffs Inc. and Disabled Firefighters Fund. Another target of the effort is on its way to making amends.

Florida and other states filed a lawsuit against Community Support Inc., a company that solicited funds on behalf of 35 charitable clients but generally kept more than 80 percent of donations, or in some cases, 90 percent of money collected.

The lawsuit also alleges Community Support harassed people who were called, sometimes falsely claimed to be members of law enforcement or veterans, or claimed someone had made a pledge when they had not.

The company has agreed to cease all improper or illegal contact, the attorney general's office said, and has agreed to regularly report information to states about its actions and improve employee training. They will reimburse $200,000 to states for the cost of the investigations.
Some tips from the FTC before you donate to any charity:

• Check out an organization before donating. Some phony charities use names, seals and logos that look or sound like those of respected, legitimate organizations.
• The words veterans or military in a charity group's literature or sales pitch doesn't necessarily mean veterans or members of the military or their families will benefit from a donation.
• Donate to charities with a track record. Charities that spring up overnight may disappear just as quickly.
• Don't make cash donations. For security and tax record purchases, pay by check -- making the payment in the name of the charity -- and get a receipt.