By Michelle Singletary – WASHINGTON POST
There are a great many people who have giving hearts, and unfortunately they are frequently the targets of scammers.

In an astounding case announced last week, the Federal Trade Commission and law enforcement officials from every state and the District of Columbia have charged four cancer charities with bilking donors out of $187 million between 2008 and 2012. The case is the largest action of its type involving charity fraud, said Jessica Rich, director of the FTC’s Bureau of Consumer Protection, during a news conference.
The complaint alleges that donors were told their money was largely being used to pay for pain medication for children suffering from cancer, for transportation to chemotherapy appointments, or for hospice care.

Instead, according to the complaint, the operators of the charities spent relatively little of the money helping cancer patients. A far greater percentage of the donations were used to pay themselves and family members six-figure salaries, go on trips, maintain gym memberships, and even pay for college tuition.

Without admitting wrongdoing, two of the operations targeted by authorities have agreed to settle the charges: Children’s Cancer Fund of America Inc. and The Breast Cancer Society Inc. The other two — Cancer Fund of America Inc. and Cancer Support Services Inc. — are still involved in litigation, the FTC said.

Experts regularly advise donors to check what percentage of the money collected by charities is used for administration and fund-raising. The higher that share, the greater caution you should have in supporting a charity.

But law enforcement officials said the cancer charities they charged had figured out a way to hide their relatively high overhead costs from contributors and regulators. One way was to inflate the amount of “gifts in kind” donations. Thirty-five states alleged that the charities filed false and misleading financial statements with state regulators. The fund-raising operations collecting donor money for the charities often got 85 percent or more of what they raised, according to the complaint.

‘We know from our work that most donors will only rely on the information they receive in [charitable] appeals.’

Art Taylor, BBB Wise Giving Alliance president
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It’s a typical practice for national charities to hire fund-raisers, according to the BBB Wise Giving Alliance, a major charity evaluator. The organization’s standards dictate that total fund-raising costs should not exceed 35 percent of total contributions raised for the year.

You should ask at least these two questions when you get a call from a charity fund-raiser that piques your interest: What percentage of my donation will go to the charity? How much will go to the actual cause? Of course, the fund-raiser could conceal the truth, so that’s why you should look for independent assessments.

The Tampa Bay Times, CNN, and the Center for Investigative Reporting did a series last year listing the 50 worst charities in America based on those that hire for-profit fund-raisers. Cancer Fund of America was No. 2. Over a 10-year period, the charity collected more than $86 million in donations, but cancer patients got less than $1 million of that, according to IRS records analyzed for the series.

The FTC has a good list of do’s and don’ts when giving to a charity. On its website, ftc.gov, search for “Charity Scams.” The BBB Wise Giving Alliance has a database you can check at give.org. Or you can check Charity Navigator’s ratings at charitynavigator.org.

Art Taylor, president and CEO of the BBB Wise Giving Alliance, has a good recommendation: Read the complaint against the charities, which you can find online at ftc.gov. Search for “Cancer Fund of America” and on that page under “case timeline,” click on the link for the complaint.

It is a “complaint that is chock full of deception,” Taylor said. “I suggest you read it cover to cover. In some cases, you’ll find it amusing, and in others — this is more likely the case — you’ll find it sad.”

Many people just want to give in the moment because they care. And scammers know this. They are skilled at tugging heartstrings so people open up their purse strings.

“We know from our work that most donors will only rely on the information they receive in [charitable] appeals,” Taylor said. “That’s all they do. They get an appeal. They read it and they make a decision right there as to whether they’re going to support that particular charity.”

Next time you get a charitable solicitation from an organization you are not familiar with, give yourself a timeout. Put a sign next to your phone as a reminder to “stop and investigate.” You are doing a disservice to legitimate causes when your money is misused because you don’t double check what you’re told. Be a wise giver so that your money is put to good work.