4 Different Ways to Report a Scam Charity

If you suspect that a charity is fake or corrupt, there are several different ways to go about reporting it. The following comprises a list of your different options.

1. Report it to the IRS

The IRS is responsible for overseeing all charities on a federal level. The good news is that there are multiple ways to file a complaint through the IRS. You can even submit an anonymous tip should you so choose. Here are your options:

2. Notify the State

Depending on which state you live in, either the Attorney General or the Secretary of State will be responsible for overseeing nonprofit regulation. To find your state’s Attorney General, click here. To find your Secretary of State, click here.

3. Inform Charity Navigator

Charity Navigator is a watchdog organization that publishes an ongoing advisory list. This list assesses each charity’s concern/risk level. To submit a claim to Charity Navigator, send an email to Charity Navigator asks that you provide substantial evidence to support your claim.

4. Contact Your Local News Outlet

Most news outlets have a special team of investigative journalists that will look into your claims should you have reason to believe that a charity is engaging in unethical practices. Better yet, these journalists will protect your identity should you choose to remain anonymous. This is a great option if you want to inform the public about the organization’s unlawful activity.

Now that you have a list of options in front of you, it’s time to start compiling your evidence so that you can report the suspicious activity. Remember: the longer you wait, the more people will be taken advantage of.


Donating Stocks to Charities

There are a lot of ways to donate money to charitable causes, but one that often gets overlooked is donating stocks. While donating cash is generally the most efficient way to give to an organization, by donating an appreciated stock, you give the organization the opportunity to sell that stock and add the resulting cash directly to their coffers, which generally allows them (and you) to avoid paying taxes on that money.

In essence, this is a way for people who own stocks that have appreciated to reduce their taxes on them. Sure, it’s not the noblest reason to donate them, but whatever works. Frankly, it doesn’t matter why somebody donates to a nonprofit, so long as that donation isn’t illegally obtained. And donating makes people feel good, so even the smallest donations are still at least a little bit driven by personal benefit.

The difference between selling a stock, paying the taxes on it, and donating the remainder versus just donating the stock isn’t all that great, but it does result in more money for the charitable organization (provided the stock in question doesn’t end up dropping in value, but it’s still money that the organization didn’t have in the first place). So if you happen to own appreciated stocks, and you were thinking of selling some of them off in order to make a donation to a specific group, donate the stock instead.

There are a few things to check first, namely that the stock has appreciated, because otherwise you are better off selling it first. But you also need to make sure that the organization to which you donate the stock is qualified by the IRS, which is easy enough to find out by looking them up on the IRS website. An unqualified organization isn’t going to be able to avoid paying taxes on that stock.

News Organizations

Walmart Accused of Using Charities to Buy Support

Community groups and organizers have accused Walmart of using charitable donations to try and buy support for the company. They claim that the Walmart Foundation has been increasing the value of their donations in areas in which they wish to build stores, and targeting charitable organizations that will improve public perception of the company and which won’t call them out for their actions.

The Walmart Foundation denies this, and the IRS has not decided to investigate them yet, but the evidence of some potentially shady dealings has been mounting. For example, back in 2008 to 2009, the Foundation donated about $200,000 to charities in Los Angeles. In 2011, as Walmart was trying to open a store there, their donations jumped up to about $1.3 million. Then, by 2013, after the store was built, they dropped back down to a mere $230,000.

It’s not just Los Angeles either. Walmart seems to be trying to buy its way into New York City as well, by ratcheting up donations to charitable organizations there. In 2009 the Foundation donated $90,000 to NYC charities, which jumped up to $1.5 million in 2010, then $6.5 million in 2011. Through this increase, it was widely known that Walmart wanted to open a store in the city, which was met with increasing resistance. More resistance, more donations. By 2012 the company had abandoned their plans for NYC, and the Foundations donations dropped to $1.5 million.

It certainly seems like Walmart is donating more money in places where they want to open stores, which isn’t what charities are for. And if it turns out that this is exactly what they’re doing, they could face trouble with the IRS. The IRS hasn’t gotten involved yet, as investigations are a big deal and require significant evidence, but if the Walmart Foundation keeps this up, the IRS might not have a choice but to investigate.