Charities have a hard enough time making ends meet to enable them to deliver their services.
When we hear about frauds and thefts in the sector, either carried out by people in organisations or by others using charity as a means to make a quick dollar, or the blatant theft of collection boxes; it makes you wonder what type of people would rip of others in need.
Not only do the scumbags who fleece charities harm them directly, but they’re tarnishing the entire sector. When stories of what some have done break – people become concerned and wonder if the money they are giving is getting to where it’s meant to be.
In 2012, BDO released a report on Not-For-Profit Fraud Survey, with these among the results:
- 12% of organisations suffered fraud in the past two years
- Specifically, 75 organisations suffered 330 frauds in the past two years
- Fraud totalling $2,916,616 was reported, with the average fraud being $8,838
- Of the respondents who experienced fraud, 49% had suffered fraud previously
- Almost one in three organisations with turnover exceeding $10 million suffered a fraud
- 25% of respondents who experienced fraud believe the full value of the fraud was not discovered
- Main factors contributing to fraud occurring were breaches of trust and overriding of internal controls
- The most common type of fraud reported was cash theft (40%)
- The average online payment fraud was $370,000
- The average duration of each fraud was 14.5 months.
But fraud, or misrepresentations by people outside of the sector is harder to monitor.
The recent case of the woman who used an online giving tool to raise funds for non-existent cancer treatment, again highlights risks the sector faces with reputation management.
This case again will make it harder for people to make the decision to give; they will be thinking twice about whether the campaign, individual or organisation is genuine.
We all must do our bit to keep our eyes and ears open to anything that may seem odd, that may not be kosher and, if we’re concerned we should be checking with organisations to ensure everything is above board.