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Recent disasters have resulted in numerous online fundraising campaigns. Crowdfunding sites are often used to help share the stories of individuals, families, and communities in need and to solicit funds from generous donors.
Unfortunately, these situations also allow scammers to set up fundraising accounts to misdirect funds for victims and those recovering from disasters. BBB warns potential donors to be cautious when giving on crowdfunding sites, particularly if they do not know the individuals involved.
To help donors make informed giving decisions, the BBB recommends the following:
- Be especially careful after a tragedy or disaster. Watch out for those seeking to take advantage of high public sympathy immediately after a disaster or tragedy by setting up a crowdfunding project that uses names and photos of victims without the families’ permission. Even if good intentions are involved, this lack of official connection to the victim(s), their families, or any charitable organization may raise questions about how well-managed this activity will be.
- Not all crowdfunding sites operate alike. Some crowdfunding sites do more vetting of potential posts than others. In some cases, after a tragedy that receives significant public attention, a crowdfunding site may directly hold and distribute funds raised by third parties for a specific victim so that those posting for help do not touch the funds raised. Other sites may not do that and rely on the poster to follow through on their announced intentions. If you are unsure how they operate, see if there is an explanation on the website or ask the site for clarification.
- Read the fine print. Crowdfunding sites vary regarding whether the donors or the project organizer will be charged for site administrative costs and credit card fees. If a project does not achieve its targeted fundraising goal, sites also vary regarding whether the donation will be refunded.
- Charities can be checked. Crowdfunding websites run by charitable organizations can provide opportunities to learn more about the organization’s programs, finances, and whether they are registered to solicit with state government agencies. In addition, third-party sources such as reports on BBB’s Give.org can help donors verify that charities meet recognized BBB Charity Standards.
For more information
BBB tips on charitable giving after a natural disaster and what to know before giving on a crowdfunding site.