Resist the urge to open your wallet to online charities too quickly following disasters, like the ones that have devastated Alabama, if you want to direct your charity dollars where they yield the greatest benefit. Take a little time to check out the charity so you give to the good ones and steer clear of the scams.
Con artists exploit disasters, setting up shop quickly on the Internet and preying on your desire to provide short-term emergency aid and long-term rebuilding efforts.
Watch for these signs of charity scams:
• "Cash, please." Never donate cash if you can help it. Write a check to the charity -- not to the person asking for the donation -- so you have a record of your donation. Ask for a letter from the charity with donation amount and date for tax purposes.
• "We need your account number." Legitimate charities don't ask for this.
• "About 10% goes to the charity, and 90% goes to administrative costs." This is not a good use of your money. You may choose to donate to charities that spend 20% or less of your donation on administrative costs. The less spent on administrative costs, the better, so ask for percentages. If they just say, "80%/20%," persist and ask which of those numbers is for administrative costs.
• "We're a registered charity." Ask for a registration number, then check with the Better Business Bureau Wise Giving Alliance at 703-276-0100 or give.org for more information.
• "We're sending you this e-mail request for a donation." Be suspicious -- most legitimate charities don't send e-mail requests unless you've donated before. Avoid clicking on links in solicitations for money, even if they appear to come from familiar organizations.
• "You don't need to check us out -- we're legitimate." No legitimate charity will say this. Besides the Wise Giving Alliance, other charity watchdogs include the American Institute of Philanthropy at charitywatch.org, Charity Navigator at charitynavigator.org, and GuideStar at guidestar.org. Or, donate through a local fundraising federation such as the United Way (Consumer Reports Money Adviser February).