Technology connects us in ways we never imaged. In our pockets, we carry a library, a radio, and a calculator. We stream live TV and make home movies on a range of devices. We interact in seconds with the church, friends, and family, and work, regardless of time or location. But, with all the good that comes with technology, there are aspects to be wary of—and giving fraud is on that list.
Giving fraud occurs when scammers seeking financial or personal gain find ways to trick churches into helping them. Giving fraud is not new, but it is preventable by staying informed, applying best practices, and using a secure giving platform.
Below, we’ll take a closer look at the top ways to prevent giving fraud. We’ll start with 2 giving fraud scenarios based on real scams and the specific prevention tips for these. Then, we’ll review even more ways to deter and prevent fraud. By applying these tips, you’ll be better prepared to spot and avoid giving fraud. Let’s get started!
Giving Fraud Scenario 1
An individual reaches out wanting to partner with your church. They’re part of an international charity, so they explain they’re unable to use their own giving platform. They convince your church to open a new account on their behalf because there are others that want to give to their cause.
Once your church sets up the account, donations between $370-$420 quickly show up. Soon, the individual reaches out to ensure the charity is receiving donations. Upon confirmation, they request your church wires some or all the funds to another ministry to reinforce the partnership.
What your church doesn’t know is that the donations are made from stolen credit cards. In order to make the donations, the fraudster tries multiple credit cards until one works. Once one goes through, they charge it multiple times by changing the cardholder’s name. Sometimes they use the names of famous actors and singers, and other times they use common names.
Fraud Prevention Tips
Be mindful when partnering with organizations that you think will further your church’s vision. While many share your passion, fraudsters spin their story to appear like an organization a church would come alongside. Apply these prevention tips to help identify and deter the giving fraud used in Scenario 1.
1. Fully evaluate all requests from new international partnerships: Fraudsters present themselves as someone you can trust, so it’s necessary to evaluate requests from new organizations.
2. Search online for the organization name followed by the words “scam” or “fraud”: Frauds are often reported by others and a quick online search will lead you to these reports.
3. Know that caller IDs aren’t always accurate: Caller IDs can be manipulated to look like the call is coming from a country or state that it’s not. Search online for the phone number to see if it’s flagged as a scam.
4. Don’t rush the decision and get others involved: Fraudsters want you to make snap decisions. Take your time and talk out the details of the partnership with others.
5. Never establish an online giving account for anyone that isn’t fully vetted: Heavily research any organization that reaches out to partner with your church. Have a system in place to vet and approve them. Take extra precautions when they make odd requests like setting up an online giving account.
Giving Fraud Scenario 2
An individual reaches out to your church after making a $5,000 donation. They explain the decimal was forgotten and they actually meant to give $50.00. Then, they request a refund. Your church issues the refund, only to find out later that the original gift was declined by the fraudster’s bank due to insufficient funds.
Fraud Prevention Tips
Mistakes happen. It’s just part of life! There are times when someone gives more or less than intended, and fraudsters take advantage of those mistakes. Here are 2 prevention tips for this type of giving fraud.
1. Let the person know the funds can’t be returned until they have settled in the bank account:
easyTithe only issues a refund for transactions that have fully settled in the bank account.
2. If the person donated through an ACH account (bank giving), let them know it takes 10 business days before a refund can be issued:
Our system only allows an ACH transaction to be refunded after 10 business days to ensure the transaction has settled and the refund isn’t duplicated.
Even MORE Ways to Prevent Giving Fraud
After exploring the 2 scenarios above, you can see that giving fraud varies. Below are even more tips to help you identify, prevent, and respond to giving fraud.
1. Learn the subtle signs of fake websites
Some frauds mimic real charities while others set up fake websites to try and look established.
A few signs a website is fake:
- They use poor spelling and grammar
- There’s no contact page or the contact information doesn’t work
- The organization’s location isn’t listed
- The domain name is a spinoff of a real charity. Here’s an example from the Salvation Army
- Real website: www.salvationarmy.org
Fake website: www.salvationarmyonline.net
- Real website: www.salvationarmy.org
- The site’ doesn’t have an SSL certificate, showing it’s not a trusted website
- View website certifications from the browser’s address bar or your specific internet browser’s certification component. (Google Chrome, Internet Explorer, Safari, and FireFox all have certification components.) Just look for the “https” before the URL and you’ll have a better sense of whether it’s safe to proceed to that organization’s website!
2. Create a plan designed for fraud prevention, detection, and response
Include the following in your strategy:
- Bring others into the decision-making process if you’re asked to refund obscure giving, establish new partnerships, or when you’re simply in doubt
- Purposely take time when making decisions that involve the church’s sensitive information. Know that most scammers try to rush the process
- Learn about the security measures offered by your online giving platform to prevent fraud
- When considering a partnership with an organization or individual, ask specific questions about their proposal. Most scammers stay vague and don’t want to give too many details
- Report any scams that you encounter to the Federal Trade Commission to protect others
A Final Note About Giving Fraud
With a little knowledge and a secure giving platform by your side, you greatly reduce the risk of giving fraud. Even if giving fraud does occur, knowing the red flags helps you identify and correct the issue much faster. Rather than being afraid, simply stay aware and use these best practices to protect your church!
Learn how easyTithe helps prevent giving fraud! Call 1-888-778-4843 or email firstname.lastname@example.org today.