November 17, 2025
Scammers are always on the lookout to exploit generosity, but the holiday season—with its surge in giving and heightened emotions—is when they strike hardest.
Consider this: a large-scale telefunding scam was dismantled after authorities revealed the scammers had made 1.3 billion deceptive calls, swindling over $110 million from well-meaning donors. (Federal Trade Commission)
Meanwhile, Cornell University researchers discovered more than 800 social media accounts running donation scams on platforms like Facebook, X, and Instagram, misleading victims into giving to fake fundraisers.
For small businesses, one wrong move in charitable donations can have consequences beyond lost funds—it risks linking your brand to fraud, tarnishing your reputation and undermining the trust of clients, partners, and your community.
Here, you'll learn how to evaluate fundraisers, recognize warning signs, and protect both your business and your goodwill this holiday season.
Steps to Verify a Fundraiser Before Donating
A reputable fundraiser should provide clear answers to these key questions:
- Who is organizing the fundraiser, and what is their relationship to the cause or recipient?
- How will the donated money be used, and what is the timeline for its distribution?
- Who manages withdrawals, and is there a transparent process ensuring funds reach the intended recipient?
- Do close associates of the beneficiary—such as family or friends—endorsed or publicly support the campaign?
If any responses are unclear or missing, request further information. Evasive or silent replies are strong indicators of potential fraud.
Identifying Red Flags That Signal Fundraising Scams
Watch out for these warning signs before contributing:
- Deceptive or blatantly false details presented on the fundraiser's page.
- Funds failing to be applied to their declared purpose within a reasonable timeframe.
- Pretending to be someone else or copying another person's story.
- Stories that seem overly perfect or designed to emotionally manipulate donors.
If you notice multiple red flags, report the fundraiser immediately and refrain from donating.
How to Vet Established Charities (Beyond Crowdfunds)
Even well-known charities can have questionable practices. Here's how to spot trustworthy organizations:
- Look for transparent program details, comprehensive financial reports, and annual impact statements.
- Check how donations are divided between program costs and administrative overhead.
- Search the charity's name alongside terms like "fraud," "scam," or "complaints" to uncover negative feedback.
Lack of transparency or negative reviews should raise caution.
Common Tricks Used by Charity Fraudsters
Be cautious of these tactics:
- Requests for donations via gift cards, wire transfers, or cryptocurrency—legitimate charities typically accept credit cards or checks.
- Websites without a secure https connection (look for the "s" in the URL), indicating insecure data transfer.
- Urgent demands to give immediately, aiming to pressure you into quick decisions.
- Claims that you've already pledged or donated when you don't recall doing so—always verify before proceeding.
Remember, even professional-looking websites and well-crafted messaging can conceal malicious intents.
Why Vigilance Matters for Your Business
Every donation your business makes—public or private—reflects on your brand. Associating with a fraudulent cause, or even having an employee donate under your company's name without due diligence, can severely damage your reputation.
Moreover, the tactics scammers use in charity fraud—such as creating urgency, impersonating others, and fake websites—also mimic methods used in business-targeted scams like phishing, invoice fraud, and wire transfer fraud. Educating your team to detect fake fundraisers strengthens overall fraud awareness.
Protecting Your Business and Your Goodwill
Follow these vital steps to safeguard your charitable efforts:
- Establish a Donation Policy: Define approved donation channels and set clear authorization limits.
- Raise Employee Awareness: Train your team to recognize fake fundraisers and verify legitimacy before donating on behalf of your company.
- Donate Through Trusted Sources: Use official charity websites instead of suspicious email links or social media posts.
- Promote Transparency: If your business publicizes charitable giving, verify the authenticity of charities you endorse.
- Monitor Ongoing Use of Donations: After giving, keep track of how donations are used—many charities publish regular impact reports.
Ensure Your Holidays Are Joyful and Risk-Free
The holiday season is a time to give generously without regrets. Implementing smart safeguards ensures your donations strengthen your business's goodwill, not jeopardize it.
Ready to equip your team to identify scams—from fake fundraisers to phishing emails and fraudulent payment requests?
Contact us at 888-638-3621 or click here to schedule your complimentary 15-Minute Discovery Call today.
Because the greatest gift you can give your business and community is unshakable trust.
