Crowdfunding Scams

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Crowdfunding Scams

With the recent tragedies such as the building collapse in Surfside, Florida, or the Europe floods, many are searching for ways to help victims and their families. As with any disaster donations, beware of scammers preying on those looking to help. They are tricky and have ways that can sound very convincing.

One of the most popular ways to help victims when disaster strikes is crowdfunding. Crowdfunding is the concept of receiving multiple small sums of money from a large number of people. Most commonly, these sites can be found spread over social media sites to gain as much traction as possible. This can happen through sites such as GoFundMe, Kickstarter and Indiegogo. Each is a great way to help those in need but can also come with its own set of concerns.

Crowdfunding social platforms can be sketchy if not properly vetted. Scammers can create fake profiles on popular crowdfunding sites, claiming to collect money for victims of a tragedy. They will collect the money under false pretenses, and the victims may never see a dime.

Use these tips to safely participate in crowdfunding:

• Know how crowdfunding sites are different. Some crowdfunding platforms vet postings and projects better than others. Check out the site’s description of its procedures.

• Photos don’t confirm a connection with victims. Some crowdfunding postings use pictures of victims without the family’s permission. Don’t assume there is a special connection just because a photo appears.

• Know how funds will be used. Will the funds help pay for funerals, medical expenses, or some other purpose? Be cautious if the description is vague.

• Check for other resources or fundraisers. Review recent announcements from government agencies and other institutions that address how they will be assisting victims. This can help donors identify crowdfunding postings that might be duplicating those efforts.

• Search for the safest option. It is safest to give to crowdfunding postings of people you personally know. If that is not possible, the next best circumstance is to find out if the funds collected by a posting are going to be forwarded and distributed by an established charitable organization. In that case, the organization can be checked out and the involvement of a third-party organization can provide an additional level of oversight and assurance.

If you believe you have been a victim of this type of scam you should promptly report it to the IC3's website at www.IC3.gov. The IC3's complaint database links complaints together to refer them to the appropriate law enforcement agency for case consideration.

Remember - always watch for scams!