There are two things that happen after every major natural disaster. They happened with New Orleans, they happened with Haiti and will most certainly happen with Japan.
The first is that there will be an outpouring of love. People will band together to help those in need through volunteering, money and in a million other ways. This part always makes me feel good to be human. The next part, not so much.
The second is that scammers will use the disaster to suck as much money out of innocent people as they can.
The instant a natural disaster strikes millions of e-mails are sent around the world asking for donations. Many of these are legitimate but most are from scammers trying to make a quick buck. They do this in many ways but I’m going to detail the most common methods.
This is probably the easiest for a scammer to pull off. They will create a website for a charity that doesn’t exist (think: The Human Fund from Seinfeld.) After that all they have to do is collect donations and use them to buy a new car.
How to avoid: Stick with the most well known charities. If you haven’t heard of it and no news organization has ever mentioned it, chances are it’s a scam. The BBB is another great resource.
Many scammers will send out e-mails pretending to be one of the largest charities such as Doctors Without Borders. The e-mail will ask for donations and will link to a page that looks exactly like the charities main donation page. Once you enter your credit card details it may even charge you the exact amount you want to donate. The problem is that the money will go directly to a scammer and won’t help anyone in need.
How to avoid: Don’t click any links within e-mails. Instead type the charities main website into your browsers address bar and go to the donation page that way.
Many charities use telemarketing to help solicit donations. The problem is scammers use the same methods. The most common scam call you’ll get will be a recorded message soliciting donations. This is because scam artists don’t have access to the same resources of live people a charity could use. The scammer may pretend to be a representative of a major charity or they may create a fake charity.
How to avoid: Instead of giving money to the person that called you hang up and call the charity direct using their 1-800 number.
Just plain BAD charity:
This one isn’t as bad since some money does actually go to the cause advertised. The issue is that most of the money donated goes towards administration fees and the CEO’s pockets. Recently it was discovered that a charity in Toronto took in millions of dollars in donations and only spent a couple thousand helping the cause they supported.
How to avoid: Check the BBB rating of the charity you wish to donate to. I would recommend sticking to the best known charities that are audited regularly.