The perils of supporting crowdfunding donation web sites

Donors would do well to investigate what they’re donating to before they actually part with their money. (Photo: iStock)
Donors would do well to investigate what they’re donating to before they actually part with their money. (Photo: iStock)

There are many kind, compassionate people who, sadly, are often misguided when it comes to donating money to people and causes that tug on their heartstrings.

And then there are some others who take advantage of the gentle hearts and set up accounts to solicit money online through personal charity sites like GoFundMe, Kickstarter or Indiegogo. So are these legitimate fundraisers or are they started by unscrupulous sorts just trying to line their pockets with other people’s money?

Of course, not everyone who has a fundraiser on a personal charity site is a scammer, but potential donors would do well to investigate what they’re donating to before they actually part with their hard-earned dollars.

Be wary of some sob stories

A 37-year-old Calgary man who recently said he was injured on a bike trail, set up a GoFundMe campaign to try to raise $8,000 for what he said were medical bills and to replace the bike he left behind, which he claimed was stolen. When people started querying him about what happened, he claimed he was being badgered. The campaign did raise $851; however, after complaints were lodged against the man, GoFundMe put a hold on the money pending an investigation.

The thing is that this man had created two prior campaigns with GoFundMe – one which raised $75 to help him spring his dog from the pound and another to help residents of Fort McMurray who were victims of the 2016 wildfires. That campaign raised almost nothing.

Usually, the official viewpoint of fundraising sites like GoFundMe is that donors contribute to campaigns belonging to people they know and trust but that’s not always doable. If you want to make sure your money is going to a legitimate cause, there are some things you can do.

Do some digging

Pages with scant information should be avoided. If people want your cash, let them tell you why and for what reasons. Check the social media presence of the person who set up the campaign. If everything you find about them is brand new, it should send up a red flag. Contact the campaigner directly. Scammers won’t likely respond or will send bogus information that doesn’t make much sense.

These fundraising sites can’t guarantee these accounts are on the up-and-up. So, it’s “buyer beware.” However, GoFundMe actually put a guarantee in place last year to refund up to $1,000 to a donor who requests it for fraudulent campaigns.

Crowdfunding calamities

Crowdfunding websites, as they’re called, are popping up everywhere and so too is the increased likelihood of fraud. Sometimes, the money raised from these campaigns has a way of disappearing, as in the case with a campaign launched for an Ontario man killed in a car crash in 2015.

A GoFundMe account was set up for the man and raised $24,000. The sad and unfortunate reality was that the family never received a penny from this campaign. The woman (apparently a friend of the deceased) who started the campaign appeared legitimate and even worked with the family. However, when it was time for the man’s widow to get the money, GoFundMe staff told her the funds were already withdrawn in 22 separate installments.

Anyone can start a campaign and say it’s for anything and then use the money for whatever he or she wants. So, if someone sets up an account for a funeral that you know has already been paid – report it because donations might just be being used for a Hawaiian vacation!
Find a Lawyer