Disasters open door to scam artists posing as charities

When Richard Ambur, MD, heard about the devastation wrought by Hurricane Katrina, he did what millions of others have done: He opened his wallet to contribute to relief efforts.

The Silverdale, Wash., orthopedic surgeon first tried calling the Red Cross several times but couldn't get through. Ultimately, he made his way to a local office of the relief organization and made a donation in person.

Despite these obstacles, Dr. Ambur's attempt to donate was made simpler because he knew which organization he wanted to support.

But with new relief efforts springing up faster than most people can write a check, the question of where or how to contribute money is increasingly confusing. And heart-wrenching pleas for help in e-mails, phone calls and advertisements only make it harder to decide which solicitations are legitimate and which are not.

As in the aftermath of other disasters, authorities say scheming con artists have pounced on the opportunity to take advantage of the shock of Katrina with both fake charities and investment scams. Even the most cautious people can fall victim because the scams are so effective at plucking heartstrings.

"In the emotion of the moment, people think, 'Here's a call, here's my credit card number. I do want to give to this,' " said Bennett Weiner, chief operating officer of the BBB Wise Giving Alliance, a national charity watchdog affiliated with the Better Business Bureau.

Evidence that such types of sordid activity may be lurking in cyberspace and elsewhere is mounting. The FBI said that by Sept. 14 -- roughly two weeks after the storm slammed into the Gulf Coast -- nearly 4,000 Katrina-related Web sites had been registered.

"Many of them may be legitimate, but fraudulent ones are popping up faster than we can pound them down," said Louis M. Reigel, the agency's top cyber executive, wrote on the FBI's Web site.

The problem is that many of the fraudulent sites look exactly like those of the real organizations they are impersonating. Weiner said even the URL or Web address can be a match.

"Do not respond to spam or e-mail messages asking for a contribution," he said. "Go directly to the charity's Web site and give online there. But do not go through any third-party connection.

"These spam messages are sent to millions of homes. They only have to hit a handful to make it successful," he added.

The scam artists may be searching for more than your cash donation. Many are seeking sensitive financial or other personal information.

And the solicitations may be coming over the phone lines as well. Weiner said there have been reports of callers who were seeking contributions allegedly on behalf of well-known charities, when in fact there was no authorization to do so. He said potential donors should always ask for written information to help prove that the request is legitimate.

To be sure, scores of the solicitations are made in a good faith effort to provide real assistance to victims of the disaster. But a charitable organization can be well-intentioned and still fail to connect the dollars it receives with real relief efforts.

Choosing an established charity with a known track record, or a charity that you have previously used, can help solve this dilemma, said Hank Goldstein, chair of Chicago-based Giving USA Foundation, which publishes research on philanthropy.

Additionally, legitimate charities are required to file government paperwork, so a check with the Internal Revenue Service or state regulators may provide clues about whether the organization is aboveboard.

Guidestar.com offers a database of charities that are recognized by the IRS as well as some information about their government filings.

The BBB Wise Giving Alliance Web site has reviews of hundreds of charities detailing whether they meet certain standards.

Some physicians may turn to medical organizations for guidance about how they can contribute. The AMA has posted links to some charities as well as information about volunteer opportunities on its Web site, and other medical organizations have offered similar resources.

Weiner said using a medical organization for a reference could provide some advantage to physicians because the organizations "may be more familiar with those who are actively engaged in health care services."

Vijay N. Koli, MD, a family physician in San Antonio, said it was an easy decision for him to make a personal donation of $1,000 to the medical organization he heads, the American Assn. of Physicians of Indian Origin.

Dr. Koli, who is president of AAPIO, said the organization's charitable arm was collecting donations not only for immediate relief efforts but also for rehabilitation and restoration projects down the road.

"There's is always an outpouring of response initially. ... But the real work begins [later]," he said.

The North American Securities Administrators Assn. has also warned of opportunistic investment scams in the wake of the hurricane.

"Bottom-feeding con artists always try to find ways to exploit tragic headlines to cash in on unsuspecting investors," said Franklin L. Widmann, NASAA's president, in a written statement. He said investors should be cautious about cold calls from salespeople, advertisements or Internet postings that tout investment pools or bonds to help hurricane victims.

Schemes promoting supposed water purification or removal technologies might also be pushed, as well as oil-and-gas scams, he added.

Widmann said investors should request written information that fully explains the investment, use common sense and contact state securities regulators to ensure that both the seller and the investment are licensed and registered.