Don't Fall for Credit Card Donation Scams

For the next few weeks, all the major credit card companies – VISA, MasterCard, American Express, and Discover – aren’t charging fees on donations made to certain charities, according to USAToday.com. Credit card issuers typically charge at least a 2% to 3% fee for credit card donations, but some credit card companies have decided to waive the fees so 100% of donations go to Haiti relief efforts.

Discover gives reward cardholders the option to donate their cashback rewards to the American Red Cross and will match donations up to $1 million. Citibank is also allowing cardholders to donate reward points from credit and debit cards to the Red Cross, reports Bankrate.

Credit card companies announced these fee waivers just days after the Huffington Post revealed that credit card companies make up to $250 million off of donations to charity. Profits from charity fees often increase after major disasters, like a devastating earthquake.

Scammers don't spare charities

If you’re thinking about donating to a charity, either to help out Haitian earthquake victims or another good cause, it’s important to be on the lookout for scams. It’s not uncommon for scammers to set up imposter websites that look like real organizations like the American Red Cross. Or, they create fake charities and try to convince goodhearted citizens to donate money.

Donate only to reputable charities

You can avoid a scam by donating only to reputable charities that you’ve heard of. If you have doubts about whether a charity is legitimate, check with Charity Navigator to see if it’s a real charity or something that’s been made up. You can also visit the Better Business Bureau to see if any complaints have been filed against the charity. Or, you can just Google the charity to see what you come up with.

Go directly to the charity

Avoid email and telephone solicitations. Most reputable charities won’t be calling or emailing you to ask for donations. Email scams often include a link to a charity that looks real, but is really only phishing for your credit card information. Telemarketers will try to urge you to make a credit card donation over the phone, even if you protest. If you want to donate to the charity, you should visit them either by using a trusted phone number or by going directly to the website via a URL you’ve verified.

Donate locally

Always donate to a U.S. charity, even if you’re helping a foreign cause. To find an organization that supports the relief efforts in Haiti, visit the American Institute of Philanthropy.

How to respond to credit card donation scams

You can report fraudulent charities to the FBI through their Internet Crime Complaint Center. Contact your credit card issuer to dispute the charges if you’ve already made a donation and later discover the organization was a fraud.