Feeling charitable?
You’re not alone. As a nation, Americans donates more to charity than almost any other country in the world. Individuals, foundations and businesses gave an estimated $358.38 billion to charity in 2014, according to the Giving USA Foundation.
But in recent years a number of fraudulent charities have come to light. Last year, the FTC announced that four cancer charities: Cancer Fund of America, Cancer Support Services, Children’s Cancer Fund of America and The Breast Cancer Society were allegedly using most of the funds that they raised to support the organizers’ friends and family — not cancer patients, with donations spent on items like cars, cruises and concert tickets.
Cases like these highlight the importance of conducting due diligence before pledging your hard earned cash to a group that you may only have a passing knowledge of. Not all charities are created equal. Some are little more than scams and others — while legitimate, may not be handling their funds as wisely as they could be. In other cases, causes with official-sounding names may pose as a charity, when in reality; they’re a fundraiser that could be skimming a significant portion of the funds for themselves before turning the rest over to the charity.
“Charitable giving is a form of investment, and people need to perform due diligence on the groups they give to,” says Ben Pierce, former president of Vanguard Charitable, a U.S. nonprofit organization that makes donations on behalf of individual account holders.
