Heads Up! Keep Your Eyes Open for This Type of Scammer

Nonprofit Management

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It may be the season of “peace on Earth, goodwill towards men,” but that doesn’t always mean that everyone’s getting into the spirit of the holidays. Although this season is a special time for thankfulness and kindness, some people are working to take advantage nonprofits and churches. Tax-exempt organizations are usually aware of what fraudulent donations look like and how to address them. Other scammers, though, are popping up on Qgiv’s radar because of an uncommon, cunning routine.

These scammers make a donation, usually (but not always!) a large one, with a stolen credit card. Later, they call the organization, explain that they made a mistake with their gift, and ask that the donation be refunded. But here’s the catch; instead of having the refund made to the same card they used for the transaction, they’ll ask that the refund be applied to a different card. Instead of being returned to the person who actually owns the credit card, that money ends up with the identity thieves.

Many nonprofits, confused by such requests, often call their online donation provider with questions about refunding donations to different cards. Many times, it’s only after talking to their provider that they realize that there might be a problem. So what should one do if faced with a similar situation?

1. Never refund money to a different bank or card

The easiest way to keep money out of thieves’ pockets is simply to avoid refunding money to a different source. Persistent scammers may press the issue. Reiterate that applying a refund to another source is not possible and that refunded money usually shows up in the bank account within a few short days. Avoid writing a check and mailing it to the donor if at all possible. If the donor is especially insistent, or if you think they might be a legitimate donor, you can try to:

2. Establish the identity of the donor through other means

If possible, establish the donor’s identity by double-checking their contact information in a pre-existing donor database or by their phone number or other personal information. Try verifying and double-checking information associated with the card or establishing the donor’s connection to the organization. It’ll take a little creativity, but digging around for information that can confirm the identity of the donor in question can prevent headaches in the future.

3. Contact your service provider or merchant processor

When in doubt, contacting the service provider or the card processor for an online form can help shed some light on the situation. They’ll be able to help you figure out the best course of action and can assess any risks associated with different solutions.

The knowledge that scammers try to take advantage of nonprofits and faith-based organizations is no fun, especially during the holiday season. But, with the right knowledge, tax-exempt organizations can protect themselves (and others!) from dishonest crooks.

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