How can you be sure you are giving to a bona fide charity?

Charity Fraud Awareness Week is an award-winning campaign which ran from 19-23 October 2020.

Now in its fifth year, it is run jointly by the Charity Commission and the Fraud Advisory Panel, and is led by a coalition of over 40 charities, regulators, law enforcers, representative bodies and other not-for-profit stakeholders from across the world. The aim of the campaign is to encourage and empower charities to talk about fraud and share best practice.

Like all sectors, charities can be susceptible to fraud and cybercrime. Those providing vital services and support to local communities during the COVID-19 pandemic are particularly vulnerable. All charities, even those with relatively small reserves to call upon, can take simple steps to boost resilience to fraud and cybercrime. In times like these, prevention really is better than cure.

The 2020 campaign focussed on 3 simple messages:

  1. Be fraud aware
  2. Take time to check
  3. Keep your charity safe

The Charity Commission is seeing evidence that opportunists are taking advantage of charities during the pandemic, and all charities are being urged to be extra vigilant against fraud. This comes at a time when charities have been a lifeline for many people suffering from COVID‑19, and have been at the forefront of responding to the crisis. But many charities have also been placed under severe financial strain through the closure of charity shops and a significant drop in income across the board. As our country faces another challenging point in the crisis, we cannot afford for charitable work to be disrupted by criminals.

When fraud hits charities, its impact is felt far beyond the balance sheet – it is people that are let down, often hard-working volunteers or people in desperate need.

As Charity Fraud Awareness Week has just come to an end, charities have reported being victims of fraud or cybercrime 645 times since the start of the pandemic in March, amounting to £3.6m in total losses to charities. The true scale of fraud against charities is believed to be much higher, as fraud is known to be underreported.

The Charity Commission is warning trustees and donors to strengthen their defences as it fears the pandemic has created environments that are enabling charity fraud.

The Charity Commission is concerned that remote working and virtual activities and sign-off processes, combined with charities’ tendencies to place goodwill and trust in individuals, may make them especially vulnerable. It says that charities providing services and supporting local communities could be amongst those at risk after earlier reports of criminals using PPE as a lure in scams.

Analysis of frauds reported to the Charity Commission has found that in some cases fraudsters have preyed on people’s fear and anxieties. In one case, the regulator saw a fraudster using a beneficiary’s story of personal struggle during the pandemic to pressure a charity into making a payment quickly. The regulator also considers that economic hardship may have increased perpetrators’ temptation to commit fraud, particularly in cases of insider fraud. It has seen cases of charity employees diverting funds into their personal bank accounts and even selling charity equipment for personal gain.

Charities are urged to follow the Charity Commission’s three top tips in the fight against fraud:

1. Be fraud aware

  • All organisations are at risk from fraud – being a charity is no defence
  • Be vigilant – in order to fight fraud, you need to find it
  • Be sure your trustees, staff and volunteers know how to spot and report fraud

2. Take time to check

  • Ensure your charity has robust financial controls in place and knows how to enforce them
  • Is there a counter-fraud policy to which staff and volunteers are signed up?
  • Trust is exploited by fraudsters – be willing to challenge unusual activity and behaviour, whoever is involved

3. Keep your charity safe

  • Prevention really is better than cure – taking simple steps now will help protect your charity from harm
  • Building a strong counter-fraud culture is vital and will boost your charity’s defences
  • Help is available – seek professional advice if you need to
  • Some charities may not even know they have been defrauded

“Check before you give”

The Charity Commission also fears that the public’s generosity could be abused before cash reaches charities. Action Fraud has received reports of a scam email purporting to be from HM Government asking for donations to the NHS during the COVID-19 outbreak.

If you think you have been the victim of a fraud, you should report it to Action Fraud online at actionfraud.police.uk or by calling 0300 123 2040.

Anyone wanting to support NHS charities can search for charities via the new register of charities and should always check for a registered charity number before giving. The Charity Commission has published advice for the public on how to ensure they are giving safely to registered charities.

Further Reading:

Can a charity prop up its trading company?

Self-Isolation Employment Rules

Barrett and Co team up with Reading Refugee Support Group.

Get in Touch

Jane Whitfield can meet with you to discuss your personal circumstances, your options and your next steps. This would normally take place in our office in Reading, Berkshire. During the coronavirus situation, however, all of our meetings are currently being carried out either by telephone or by video link.

If you would like to meet with Jane, please telephone the office so that an appointment can be made for you. If you would like to take up our offer of a one-hour £95 fixed fee meeting, please click for more details.

Jane is a Solicitor specialising in Private Client matters. Jane is a qualified Trusts & Estate Practitioner with STEP (Society of Trusts & Estates Practitioners) and a fully accredited member of Solicitors for the Elderly, as well as being a Dementia Friends Champion. Jane is also President of the Berks, Bucks & Oxfordshire Law Society.

"barrettandco" and "Barrett & Co" are trading names of Barrett & Co Solicitors LLP, a Limited Liability Partnership incorporated in England and Wales under registration number OC356263, with registered office at Salisbury House, 54 Queens Road, Reading, Berkshire RG1 4AZ. Barrett & Co Solicitors LLP is authorised and regulated by the Solicitors Regulation Authority www.sra.org.uk (SRA Number 549694).

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