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A new breed of scammers take your money by pretending to be relief organizations
By Michael Summers
Fort Wayne Reader
It wasn’t even 24 hours after the Hurricane Katrina struck New Orleans and the levees broke when the vultures came out.
The country was just realizing the enormity of the disaster, with images of a city nearly totally submerged, and thousands of its citizens, now refugees, crammed into the Super Dome with little food, water, or medicine, and ScamBusters, a highly respected watchdog website and newsletter that tracks internet scams (www.scambusters.org), started getting reports on phony websites and organizations soliciting funds for hurricane relief. And the number kept growing. Just two weeks after the hurricane, ScamBusters has now seen four times the number of scammers than they saw after the tsunami disaster last December. “It really is amazing,” says Audri Lanford, co-founder and editor of ScamBusters. “In fact, I should be updating the website right now…”
If a disaster brings out the best in people in terms of charity, it also brings out the worst. Already, not even a month after the country realized the devastation wrought by Hurricane Katrina in New Orleans, the Federal Bureau of Investigation has cataloged over 2,300 websites offering hurricane relief services. At last count, they estimate that as many as 60% of these could be bogus.
“Unfortunately, any time there’s a tragedy like hurricane Katrina that gets so much media attention, the lowest of the low-lifes just come out of the woodwork to take advantage of everyone’s goodwill,” says Sandra Minutti, spokesperson for Charity Navigator (www.charitynavigator.org), a website that monitors charities. “It happened after September 11th, it happened after the tsunamis this past winter, and it’s happening now.”
The scammers are pretty inventive. Unsolicited e-mail and phony websites make up an enormous portion of the charity scams out there, but they aren’t the whole picture. Fake fund-raisers, phone calls, and even dropping some change in a bucket in the name of a recognizable charity are all ways to prey upon the public’s good will in times of crisis.
In fact, in the wake of Hurricane Katrina, watchdog groups and law enforcement have even seen a resurgence of an “oldie-but-goodie” in the scam world: the “Nigerian Letter.” The letter is not always from Nigeria, and has several variations, but the basic mode of operation is the author says he or she is a Nigerian resident (sometimes a government official) trying to transfer millions of dollars illegally out of Nigeria, and offers the recipient a percentage of the money in exchange for help. The recipient is asked to send information — letterhead stationery, bank name and account numbers and other information. The author also requests money to facilitate brides, legal fees, plane tickets, etc. By the time the victim wises up, the perpetrators not only have all that money to cover “expenses,” they also might be using the identity information to drain bank accounts and run up credit card debt.
The latest variation of the “Nigerian Letter” stars a widow from Gambia. She’s Dutch, a born-again Christian, and her husband (a doctor) worked for an “oil flow station” until he was killed in “youth riots,” leaving millions of dollars frozen in a financial institution in Europe. She wants the money to help alleviate suffering around the world, like the suffering caused by Hurricane Katrina. Oh, yeah, she also has cancer.
Scams like these sound, at the very least, like an urban legend. At the most, they sound like something only an idiot would fall for. Nevertheless, the FBI says people do fall for it, to the tune of millions of dollars annually.
But perhaps the most prevalent (and successful, if you’re a scammer) scams are simple requests for donations via e-mail. It’s referred to as “phishing,” and usually comes complete with a fake website pretending to be a legitimate relief organization. Any contributions you make go directly into the pockets of the perpetrators, and if you enter your credit card or other personal information… well, your “gift” just keeps on giving. Once again, despite almost weekly news stories about the potential dangers of sending personal information over the internet or opening attachments in an unfamiliar e-mail, these phony requests are surprisingly effective, especially when they’re tied into a widely-covered disaster. “I think that the scammers are very clever, and there are a lot of people who are new to the internet,” says Audri Lanford of ScamBusters. “It’s a question of education. You hear it (the dangers of unsolicited e-mail) a lot, but I can tell you from our e-mails that many people don’t get the message.”
The “clever” scammers Lanford mentions rely on association and trust on the public’s part to pull off their scam. They’ll say they’re from (for example) the Red Cross, and if people see a logo and an official-looking site, they don’t bother to look further. Stealing an organization’s logo or even setting up a fake website with all the appearances of the real deal is child play these days. “It’s really easy to steal a logo off an actual charity’s website and develop a fake website,” says Sandra Minutti of Charity Navigator. “I think people who feel a need to give and help in these situations don’t really think it through. They click through these e-mails and make a donation, and really just turn their credit card information over to a criminal.”
A legitimate charity won’t send unsolicited e-mail, Munitti says. Most of them don’t have time to send out spam. The same goes for phone calls. “I’d be really leery if you get a telephone solicitation from a charity,” Minutti says. “Once again, the organizations responding to this crisis really don’t have time to be calling you on the phone right now. They’re probably in need of volunteers to answer their own phones.”
Even if it is a legitimate organization calling you, Minutti says your donation might be put to better use if you contribute directly. “They usually employ a for-profit firm to make those calls, and that for-profit firm can keep 25% to 95% of your donation. I’d hang up that call, and do some research on your own. If you want to give to that charity, send your check directly there. Cut out the middle man.”
Charity Navigators recommends that donors take a look at those groups that are able to spend at least 75% of their budget on their programs and services. “It’s important to keep in mind that they do have to spend at least some money on over head,” Minutti says. “They run an office, they need to keep the lights on, and they also need to hold back some money so they can fund raise for the next dollar. But a minimum of 75% should be going to the programs and services the charity provides.”
It’s the Red Cross that often gets hit the hardest when it comes to scammers impersonating a legitimate charity. It’s an easy recognizable name and logo; people see “Red Cross” in an e-mail and they tend not to question it. Jessica Dettmer, spokesperson for the Northeast Indiana Chapter of the American Red Cross, says the Red Cross isn’t aware of any local scams, but it’s something they’re always on the look out for. “It’s something that unfortunately always happens,” Dettmer says. “We’ve always encouraged people to contact the organization directly if they think something is suspicious. That way, the organization can let them know this fundraiser is taking place, or sponsored by us, and let them know exactly what the funds will be used for.”