How to report nonprofit fraud

How to report nonprofit fraud

When someone asks about the best practices for nonprofit reporting, many assume they’re simply talking about taxes. In reality, tax law is pretty straightforward. The real complexity comes in relation to generating data reports and putting them to good use.

The fact is, without utilizing their available data, nonprofits will never be successful. Fortunately, the following reporting best practices are easy to implement, maintain and solidify in organizational functions.

Use the Right Tools

In all likelihood, you could probably create basic reports using Excel. If you’ve ever tried this, though, you know they don’t do much good. There’s simply not enough information or visual options to garner any useful report.

Instead, use some form of fundraising report software that can track grants, provide fundraising analysis and create reports on everything from constituents to finances. Better yet, use a tool that allows custom reports in case you want a report on data that others might not realize is useful.

Know Which Nonprofit Reports to Review

One of the most essential best practices for nonprofit reporting is actually knowing which reports to review . There’s no such thing as being “too informed,” but if you’re reviewing these at least monthly, you should be in good shape.

  • New donor reports
  • Lapsed donor reports
  • Top donors
  • Monthly donors
  • Volunteer hours

Use Reports to Create Plans of Action

Once you’ve got all that data regarding donors who gave l ast y ear b ut u nfortunately n ot t his y ear ( LYBUNT ), those who gave s ome y ear b ut u nfortunately n ot t his y ear ( SYBUNT ) and anything else you feel the need to track… what’s next?

It’s time to put those reports to work. Create a retention email and blast it out to previous donors. Change your social media strategy based on the numbers generated from a paid ad. Adjust your goals for next year after reviewing this year’s solicitation revenue. Doing nothing with this data is a sin in the nonprofit world.

Take it to the Next Level

Following the best practices for nonprofit reporting is an essential aspect of reaching new donors, getting repeat donations and just about everything else having to do with fundraising. By gathering, reviewing and implementing change based on these reports, the success of a nonprofit will only continue to increase.

How to report nonprofit fraud

James Woodson/Digital Vision/Getty Images

How to File a 501(c)(3) in Georgia

Fraud has seen many nonprofit organizations lose funds running to millions of dollars in unclear circumstances. Your report of fraud could help recover diverted assets and serve justice to perpetrators. A Washington Post article on Oct. 27, 2013, cites the case of Lela West of the Virginia Scholastic Association, who was handed a 10-year prison sentence in March 2012 for financial fraud and ordered by the court to compensate the organization with restitution totaling $150,000.

Spotting Fraud

Financial audits and investigations of nonprofit organizations have unearthed many fraud cases perpetrated by employees and other insiders. Some fraud perpetrators falsify financial information of their nonprofit organizations to conceal the embezzlement and misappropriation of funds. Findings of the 2012 Global Fraud Study published by the Association of Fraud Examiners showed that median fraud-related losses in nonprofit organizations reached $100,000 in 2012. The incidents of fraud at nonprofits are usually precipitated by environments of trust and friendships that employees and volunteers exploit to fleece these organizations.

Gather Evidence

Once you detect fraud, follow leads and gather appropriate evidence from accounting and communication documents. This could be local purchase orders, supplier and debtor invoices, payment vouchers, credit card slips, credit notes or signed contract forms. Form 990, which nonprofits file annually with the Internal Revenue Service, can also provide substantiating evidence. The nonprofit is required to report contributions and grants, program revenue, benefits paid to members and other financial information. The documented evidence will help you back up your allegations against any individual suspected of defrauding the nonprofit organization.

Identify the Appropriate Reporting Channel

If you are an internal or external auditor, highlight detected fraud in your audit report and recommend further investigations. An insider such as a staff member, board member or volunteer may have to report fraud anonymously to avoid retribution from perpetrators of the fraud. Contact fraud reporting organizations, such as the Fraud Hotline and Federal Trade Commission, to confirm whether they can investigate your fraud report. Fraud Hotline offers fraud reporting services to its registered organizations while the FTC attends to fraud red flags from donors and consumers of nonprofit services.

Submit the Fraud Report

Use the hotline numbers, email contacts and online contact forms provided by whistle-blower organizations to submit your fraud report. Some of these organizations provide website links for reporting fraud online. They also allow you to attach copies of your documented evidence in the emails and online contact forms. Seek the help of your state attorney general for legal guidance for reporting fraud in a nonprofit organization.

  • The Washington Post: How the ‘Queen’ of High School Rowing Left a Virginia Nonprofit Treading in Water
  • Idealist: Dealing with Fraud or Abuse
  • Fraud Hotline: Fraud Hotline Services
  • Association of Fraud Examiners: 2012 Global Fraud Study — Report to the Nations on Occupational Fraud and Abuse

Paul Cole-Ingait is a professional accountant and financial advisor. He has been working as a senior accountant for leading multinational firms in Europe and Asia since 2007. Cole-Ingait holds a Bachelor of Science Degree in accounting and finance and Master of Business Administration degree from the University of Birmingham.

Your Legal Questions Answered

Where can you report unethical or illegal conduct of a nonprofit organization? There has been repeated verbal abuse, threats to other employees and theft by an employee. This employee has been reported by several employees on each incident to the immediate supervisor and the president of the board. There has been no action taken by the president or the supervisor. The employee is related to the board president.

From your statement that there have been threats to “other employees,” I assume that you are also an employee of the nonprofit. If so, the first place I would look is the organization’s whistleblower policy. Since the IRS asks on the Form 990 whether a nonprofit has a whistleblower policy, most nonprofits do. You should ask to see it so that you can see what is covered and how to report.

Most policies will cover reporting of theft but a less comprehensive policy might not cover reports of verbal abuse or threats. It will also tell you to whom to report, which is probably the immediate supervisor first, and then the CEO or a member of the board, perhaps the president or head of the audit committee, if you are not satisfied with the supervisor’s response. If you have already reported to the named individuals without results, you should go to the third alternative or another member of the board who you think might be sympathetic. If the board doesn’t act but you have voting members, you could also go to them with your concerns. The more of you who join in the reporting, the more likely the organization is to take it seriously.

If you comply with the policy, you should be protected from retaliation, but I wouldn’t guarantee it. Most organizations retain the right to modify their policies whenever they want to, and some just disregard the policy when they don’t want to follow it.

If following the policy, or reporting to the board if there is no policy, fails to get results, you can always report the theft to law enforcement personnel. Law enforcement is not likely to take action because of verbal abuse or random threats, but theft, if sufficiently large or pervasive, might get their attention.

Most whistleblowers who go outside the organization are people who got no response to blowing the whistle internally. Organizations who understand this simple fact are more likely to treat employee complaints with respect and to take remedial action where warranted. You can only hope that someone in your governance structure understands that it is better to deal with an issue internally than to wait until the attorney general or local prosecutor shows up.

I gave a small, one-time donation to actblue.com several months ago. Recently checking my credit card transactions, I found that they have been charging me various sums weekly. Even after I sent an angry letter, they kept charging my card.

I was a volunteer for a toy drive @ Xmas time. There were thousands of dollars worth of donations. The lady who did the toy drive was stealing from her own charity and was feeling some of the donations and selling them and keeping the money for herself. She thought that by deleting all the evidence that was posted all over Facebook you don’t announce thing the toy drive showing all the toys the venue and all that that it would go away but I screenshotted every single picture before she deleted it. So now what do I do? She had even giving the people who donated items a bogus 501 c 3 number. So people started coming forward and then she just disappeared Into Thin Air not really but she sure putting everybody on block.

This was my first 50/50 raffle at a Florida Panthers game last week. I asked several questions to a vendor regarding where the money was going? She did not have an answer! This vendor needs to be investigated on the 300 level! She kept saying the cash ticket was not going through! She asked for additional funds!

One of the charities were given $25,000.00. On another evening, I heard another charity received $200,000? How can this be?

I went to research the Florida Panthers Foundation and they are in the red for over $250,000? This is public record! Be careful. I will ask the State to investigate this matter immediately!

How to report nonprofit fraud

Table of Contents

I once worked at a big-box store during the Christmas season. My biggest surprise was how many people steal and how clever they can be with their deception.

Fraud for nonprofits is even more devastating. Negative publicity and possible loss of funding are consequences of nonprofit fraud. In 40 percent of fraud cases, the victim organization chose not to refer the incident to law enforcement for fear of bad publicity.

All nonprofit organizations with assets are at risk for fraud, and sadly, most of the fraud is performed by people hired to carry out the organizations’ missions.

The Cold, Hard Facts about Nonprofit Fraud

Knowing the top categories of fraud is a good starting place for creating sound anti-fraud policies for your nonprofit organization. The data presented here has been gleaned from the Report to the Nations on Occupational Fraud and Abuse, a definitive study by the Association of Certified Fraud Examiners (ACFE).

Nonprofits are generally established for beneficial purposes and assume their employees, especially senior management, share the organization’s philanthropic mission. As such, nonprofits tend to be more trusting of their employees and have less stringent financial controls than their for-profit counterparts. For that reason, nonprofit embezzlement cases and other forms of employee fraud occur at an alarming rate.

The ACFE study illuminates several notable trends in how occupational fraud is committed and detected, and how organizations can rise to combat the threat.

The 2,400-plus fraud cases studied reveal several trends. By organizing the cases around these patterns, the ACFE discovered that all fraud schemes fall into specific categories.

At the top of the fraud tree are three categories: misappropriation of assets, corruption, and financial statement fraud. Cash was by far the largest misappropriation at 34.5 percent of the total, probably because cash is easy to “misplace.” Cash includes skimming, larceny, cash on hand, and register disbursements.

  • Asset misappropriation can be described as using a nonprofit’s credit card for personal items.
  • Corruption can include giving or accepting bribes or inappropriate gifts, under-the-table transactions, diverting funds, and laundering money.
  • Financial statement fraud is the deliberate misrepresentation of the financial condition of the company through falsifying balance sheets, income statements and cash-flow statements to fool people.

The total amount of money lost in fraud is astronomical. Over $168,000 was the reported annual median loss to cash fraud. Who wouldn’t like $168,000 added back to their budget?

Check tampering and embezzlement follow cash fraud with a median annual loss of $158,000. With today’s scanning technology, forging check stock, signatures, and endorsements is easier than ever before. Treat your check stock like cash — lock up them both and restrict access.

Length of Nonprofit Fraud Cases

Let’s pause for a quiz.

The median duration of fraud reported by the ACFE study is:

A. 12 months
B. 18 months
C. 24 months

Did you guess b? That’s correct! Remember, the median is the middle. Some frauds last much longer – the longer they last, the higher the losses. One-third of fraud lasts two years before it is detected.

Register disbursement schemes were discovered the soonest at around 13 months. In contrast, payroll, check tampering, financial statement fraud, expense reimbursements, and billing schemes all last a median of two years before being detected.

How to Prevent Nonprofit Fraud

Since the misappropriation of funds is at the top of the list of nonprofit fraud cases, organizations should take proper steps to protect their assets. Cash and check tampering top the list with a combined loss of more than $400,000 annually. Here are the ways to help prevent fraud:

  1. Lock it up! This includes cash and check stock. Have more than one person present when money is counted.
  2. Cash functions such as deposits, check writing, and bank reconciliations should be handled by different people.
  3. Bank reconciliations should be up-to-date. Consider hiring temporary help to bring your bank reconciliations current if you’re behind.
  4. Don’t pre-sign checks.
  5. Don’t be too trusting!

Finally, use your fund accounting software to monitor cash balances, send alerts to more than one senior staff member, and review your audit trails regularly. Have policies in place and make sure employees understand they will be enforced. Prevention is easier than detection, but if you need to report nonprofit fraud, contact local law enforcement. For more useful information, check out resources from MIP.

More In File

  • Individuals
  • Businesses and Self-Employed
  • Charities and Nonprofits
    • Exempt Organization Types
    • Lifecycle of an Exempt Organization
    • Annual Filing and Forms
    • Charitable Contributions
    • Search for Charities
    • Education Sessions
  • International Taxpayers
  • Governmental Liaisons
  • Federal State Local Governments
  • Indian Tribal Governments
  • Tax Exempt Bonds

If you suspect a tax-exempt organization is not complying with the tax laws, you may send information to the Tax Exempt and Government Entities Division. You may use Form 13909, Tax-Exempt Organization Complaint (Referral) Form PDF , or send the information in letter format, and attach any supporting documentation for this purpose. Form 13909 PDF , or complaint letter, can be submitted one of the following ways:

  • Email to [email protected]
  • Mail to TEGE Referrals Group, 1100 Commerce Street, MC 4910 DAL, Dallas, TX 75242, or
  • Fax to 214-413-5415

In addition to oversight by the IRS, tax-exempt organizations are subject to oversight by State charity regulators and State tax agencies. You may also want to send a copy of the referral you send to us to your state tax agency.

Acknowledgement and Disclosure Prohibition

After a referral is made, we will mail an acknowledgement letter to all non-IRS sources making a referral, unless it was made anonymously. To receive an acknowledgement letter, you must provide your name and return address. We are unable to send acknowledgement letters through e-mail.

We will keep your identify confidential when you make a referral. You won’t receive a status or progress update due to tax return confidentiality under Section 6103 of the Internal Revenue Code.

Message [Page 1 of 1]

1 How to Report Fraudulent Nonprofit Orgs Like David Wilcocks 501c3 #TIMETOSTOPBLUECHICKENFRAUD Fri Mar 20, 2020 3:35 pm

PurpleSkyz

How to report nonprofit fraud

How to Report Fraud in a Nonprofit Organization

November 8, 2012 at 10:35 AM

While organizations such as charities and religious groups are given nonprofit status, abuses can still occur. As much as $40 billion annually has been lost due to fraudulent activity by nonprofit organizations. If you suspect that a nonprofit organization you are working for or have contributed to is guilty of fraud, It is important to know how to effectively report it, so that it can be stopped.

1. Lodge a complaint with the Better Business Bureau. If, for example, you have been a contributor to a nonprofit organization and believe monies have been misused, go directly to BBB’s website at www.bbb.org/us/charity/ and file a complaint. Provide your contact information and give specific details about why you are filing a complaint. Be aware that the BBB gives the charity or nonprofit a chance to deny or resolve the issue.You can also write your complaint and mail it to: BBB Wise Giving Alliance, 4200 Wilson Blvd., Suite 800, Arlington, Virginia 22203. Once you report a charity or nonprofit, your complaint will remain a matter of record with the BBB, so that future potential contributors will be forewarned.

2. Contact the Internal Revenue Service with your suspicions. Go to the IRS website at www.irs.gov and fill out their Form 13909. Print it out and mail the completed form, along with any supporting documentation, to: IRS EO Classification, Mail Code 4910DAL, 1100 Commerce Street Dallas, TX 75242-1198, or fax to 214-413-5415 or email to [email protected] Supplying specific examples and documentation to back up your claim, such as copies of files, financial reports and transcripts that show inconsistencies, will bolster your credibility. If the IRS feels that you have provided adequate evidence of fraud, it will investigate.

3. File a complaint with the Association of Certified Fraud Examiners chapter nearest you. You can find that chapter by going to www.acfe.com. Upon receipt of information that substantiates your claim of fraud, they will investigate and come up with their own findings.

4. Report fraud suspicions to the U.S. Postal Inspection Service. If a nonprofit organization has been sending out letters requesting contributions that have not been used as promised, this constitutes mail fraud. You can fill out a complaint form at postalinspectors.uspis.gov/forms/MailFraudComplaint.aspx.

5. Go to the media. If you believe that a nonprofit organization has committed fraud, get in touch with a local newspaper or television news station. Be prepared to provide as much information as you can, such as documentation, financial reports and witnesses, to back up your claims. If they feel your suspicions are merited, they may do an investigative report that exposes the fraud.

Read more: How to Report Fraud in a Nonprofit Organization | eHow.com http://www.ehow.com/how_5099703_report-fraud-nonprofit-organization.html#ixzz2BeKKJ1JQ

In Canada:

Complaints about registered charities

Should you wish to make a complaint about a registered charity, please email the Compliance Division of the Charities Directorate by selecting the link below. Please provide the name and registration number of the charity along with detailed information in support of your complaint.

Please note that, due to confidentiality requirements, actions taken by the CRA are not made public, except in cases of revocations, penalties, annulments, and suspensions. However, all complaints are reviewed and dealt with in an appropriate manner. The identity of complainants remains confidential.

If you do not wish to email, you can write to, or call, Client Service – General enquiries and your complaint will be redirected to the Compliance Division.

All charities must comply with Canada’s anti-terrorism legislation, and the Criminal Code. Charities are responsible for ensuring that they do not operate in association with individuals or groups that are engaged in terrorist activities, or activities in support of such activities. An applicant may be denied registration, and a charity’s status may be revoked, if there are reasonable grounds to believe the applicant or charity operates in such a way as to make its resources available, either directly or indirectly, to any entity, whether or not it is listed under the Criminal Code, that engages in terrorist activities or activities in support of them. The CRA’s Charities Directorate has produced a Checklist for Charities on Avoiding Terrorist Abuse to help Canadian charities identify vulnerabilities to terrorist abuse, as part of good management practices. (For more information about these provisions, see Charities in the International Context.)

Here is a sample letter of complaint in Canada.

How to report nonprofit fraud
What do I do if I suspect that a charity is a fraud?
If you are suspicious of an organization or believe you have become a victim of a charity scam, several web sites and organizations can help and are listed below.
There are public sources available to assist in determining whether a specific charity is legitimately registered with the appropriate state and federal agencies. To locate information such as exempt status, financial filings and other pertinent details, you can refer to our Knowledge Base article, How can I find information about a particular (non-grantmaking) charity?
The Federal Trade Commission (FTC) provides an online Charity Checklist with useful advice designed to help you determine whether the charity in question is a legitimate one.
Topic(s) Trust & Transparency

The Internal Revenue Service gives serious consideration to complaints made alleging the abuse of the tax exempt status granted to certain organizations.

When reviewing filed complaints, the IRS carefully follows special procedures designed to assure the public of the IRS’s objectivity in the treatment of tax-exempt organizations. These procedures ensure that the IRS operates in an unbiased and appropriate manner and that its compliance programs are not improperly influenced by outside intervention.

The responsibility for administering these procedures belongs to the Exempt Organizations (EO) function, which is part of the IRS’s Tax Exempt and Government Entities Operating Division.

Complaints (Referrals)

A complaint (also called a referral) is any communication alleging that a tax-exempt organization is in potential noncompliance with the tax law. EO receives complaints from the general public, members of Congress, federal and state government agencies, as well as from other parts of the IRS.

Filing a Complaint

Members of the public may send information that raises questions about an exempt organization’s compliance with the Internal Revenue Code by submitting Form 13909, Tax-Exempt Organization Complaint (Referral) Form.

Form 13909 and any supporting documentation may be submitted in a variety of ways. They can be sent via:

Mail to IRS EO Classification, Mail Code 4910DAL, 1100 Commerce St., Dallas, TX 75242-1198,

Fax to 214-413-5415, or

Submission of Form 13909 is voluntary.

Acknowledgement and Disclosure Prohibition

All referrals are sent to analysts at the EO Classifications Office in Dallas. After a referral is made, the IRS will send an acknowledgment letter to all non-IRS sources making a referral, unless it was made anonymously.

Section 6103 of the Internal Revenue Code prohibits the IRS from disclosing whether it has initiated an examination or the results of any examination. Therefore, the IRS cannot communicate with the original source of a referral beyond the acknowledgment letter.

The Review Process

Upon receipt, research is done to confirm the identity of the organization in question and once this is complete, information is entered into a database to help the IRS keep track of the progress of the review.

An experienced EO revenue agent then performs a thorough technical analysis of the allegation made on the referral. The agent uses a “reasonable belief” standard to evaluate the facts and to determine whether EO should take further action. Before taking action, the revenue agent must determine that the facts create a reasonable belief that the allegations may be true when considered fairly and in light of other reliable information.

The reviewing EO agent will decide one of the following:

The information does not warrant further action. In this case, the agent inputs information, including rationale, into the database and closes the referral.

The referral relates to activities that should be considered at a future date. The agent documents the database and schedules the appropriate date to re-evaluate the information.

The referral contains characteristics that require it to be forwarded to a committee of career EO managers and agents. This committee evaluates referrals monthly — more often in some circumstances — and decides whether to proceed with an examination. The committee also applies the “reasonable belief” standard.

The information warrants an examination of the organization. The agent documents his or her decision and the reasons for it in the database. The information item then becomes part of the examination file.

If this process results in a decision to examine an organization, the Classification Office will forward the case to a field group for assignment to a revenue agent. The revenue agent will contact the organization and schedule an appointment to begin the examination. For details on the EO examination process, see FS-2008-14 which describes the tools the IRS uses to ensure that tax-exempt organizations comply with Federal law.

DISCLAIMER: This information is not intended to provide legal or accounting advice, or to address specific situations. Please consult with your legal or tax advisor to supplement and verify what you learn here.

Martin Levine

How to report nonprofit fraud

The Key Worldwide Foundation put on a good show. When it filed its 2016 Form 990 with the IRS, it proudly proclaimed its noble purpose, to “provide education that would normally be unattainable to underprivileged students, not only attainable but realistic.”

With programs that are designed to assist young people in everyday situations, and educational situations, we hope to open new avenues of educational access to students that would normally have no access to these programs. Our contributions to major athletic university programs may help to provide placement to students that may not have access under normal channels.

It presented a picture of fiscal strength, having raised more than $7 million since its founding and more than $2 million in assets. But we now know it was a charade, using the aura of a nonprofit organization as a cover for illegality and personal gain. Rather than help low-income students, it served as a vehicle for wealthy parents to tilt the admission process in their favor. If there’s good to be found here, it’s that this is teaching the nonprofit sector it needs better oversight.

Last week, the foundation’s founder and president, William “Rick” Singer, and his scheme were unmasked when, according to the Chronicle Tribune, federal prosecutors announced he had pled guilty to racketeering, money laundering, and obstruction of justice in what the FBI dubbed “Operation Varsity Blues.” Singer took money from parents who wanted to plant their children in elite universities and used it to pay off college officials and ACT/SAT test administrators. In the process, he himself also became wealthy.

Wiretap conversations “show the true purpose of the charity—to be the conduit for five- and six-figure bribes paid by parents.”

Sign up for our free newsletter

Subscribe to the NPQ newsletter to have our top stories delivered directly to your inbox.

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

Parents got written letters from KWF that said, “Thank you for your generous donation.” To make the bribes appear legitimate, they received receipts from KWF falsely indicating that “no goods or services were exchanged” for their supposed donations…Singer allegedly agreed with certain clients to disguise bribe payments as charitable contributions to the KWF, thereby enabling clients to deduct the bribes from their federal income taxes.

From what we know now, the malfeasance was quite open to discovery and very easy to find if anyone was paying attention. In filing its annual tax return and in giving its “donors” their quid pro quo letters, the foundation met the letter of the law, counting on the fact that the IRS requires little more. As Larry Lieberman, former chief operating officer at Charity Navigator, told Talking Points Memo, “There is not an enormous amount of resources at the IRS and in other parts of the government to provide oversight in real time. What we’re seeing now is it took years for the government to break down this situation.”

This lack of oversight meant it could lie about where its funds were going because no documentation was demanded. According to NBC Bay Area, in 2016, “KWF reported paying $1.9 million to various causes including a tutoring program for students in Oakland who were ‘underserved’ by their districts. When NBC Bay Area contacted the Oakland Unified School District, an official said the district had ‘never heard of the tutoring program and has no relationship with the Key Foundation.’…KWF also claimed it helped fund dental work for Cambodian children. A dentist with the office that runs that program told us he’s never heard of anything funded by KWF.”

At least one parent also used the lack of oversight to misuse their own charitable foundation for what could ultimately be seen as a bribe. According to the Champaign News-Gazette, “Elisabeth Kimmel allegedly paid bribes to get her kids into Georgetown and the University of Southern California…with $525,000 from her family’s Champaign-based Meyer Charitable Foundation.”

According to John Colombo, an emeritus law professor at the University of Illinois who has co-written two books on nonprofit tax exemption. “This transaction probably violated half a dozen provisions of exempt-organization law. It’s self-dealing. It’s private inurement. It’s private benefit,” he said. “There’s all sorts of things.”

The scheme’s details have led many to focus on the unfairness of the college admission process, the continuing power of the wealthy to tilt the system in their favor. According to the Los Angeles Times, “One of the aspects of the case that has inspired particular outrage is that the parents who took part in the alleged bribes got tax write-offs for the money they spent.” Concern has been raised about legal contributions that are large enough to influence college and university admission decisions. Some legislators are looking at proposing new regulations that would limit the deductibility of what Senator Ron Wyden (D-OR) described as “contributions that return to the donor a benefit of inestimable value.”

Less attention has been paid to how easily a nonprofit organization could be turned from public benefit to public enemy. It should not take several years to discover that a nonprofit organization is a fraud. If more resources are needed at IRS, will the sector add that need to their advocacy agenda? If self-policing is possible, how could that be done?—Martin Levine

Information provided to the OAG via the hotline or other methods below may result in an investigative or performance audit or other review. When providing information, please include sufficient detail (describing who, what, where, when, why, and how) to allow us to fully evaluate your information.

Completion and submission of the Fraud/Waste/Abuse Allegation Form will result in your allegation being e-mailed to our Fraud/Waste/Abuse Hotline staff. Once received, the information on the form will be handled in the most confidential manner allowed by law.

You are not required to identify yourself. However, please understand that submitting information anonymously may limit our ability to obtain additional insight that may be necessary for a thorough investigation of your allegation. It is important to emphasize that circumstances may exist under which the OAG is legally obligated to reveal your identity, such as if your allegation is referred to a law enforcement agency.

The OAG does not normally advise individuals who have filed allegations of the existence, status, or outcome of an investigation. Generally, we will only contact you again if the need exists for additional information or clarification.

The OAG does not represent or act on behalf of any individual or agency. If you are seeking a legal opinion or representation, you should consult with an attorney.

Other State agencies can assist you with certain types of concerns and/or allegations that we generally do not investigate. Examples of those topics include complaints regarding child abuse and neglect, nursing home or other health care issues, welfare or public aid fraud, public utilities, and the like. Please see Other Resources for Reporting Potential Fraud, Waste, Abuse and other Complaints for a listing of common topics and corresponding agency and contact information.

If, to the best of your knowledge, your allegation involves State government operations and/or a State employee, you may report your fraud/waste/abuse allegations by any of the methods listed below:

    Click here to complete the Fraud/Waste/Abuse Allegation Form and submit online.

Call the toll-free Fraud/Waste/Abuse Hotline at (517) 334-8070. This hotline is available 24 hours a day, 7 days a week. An investigative auditor is generally available to take your call Monday through Friday from 8:00 a.m. to 4:00 p.m., or you can leave a message after hours.

  • Complete the Fraud, Waste, Abuse Allegation Form, print, and send via the U.S. Postal Service to the following address:
  • Office of the Auditor General
    Fraud Investigation Section
    201 N. Washington Square, Sixth Floor
    Lansing, MI 48913

    • Forum
      • New Posts
      • FAQ
      • Forum Actions
        • Mark Forums Read
      • Quick Links
        • Today’s Posts
    • Legal Articles
    • Lawyers
    • Experts
    • Forum
    • Government and Administrative Law
    • Tax Law
    • Federal Taxes: How to Report a 501(C)(3) Non-Profit Violations
    Thread Tools
    Display

    How to Report a 501(C)(3) Non-Profit Violations

    I have information that a 501c3 non-profit organization is in violations.

    Their founder and trustee has effectively been running and profiting from a business that mirrors the non-profit organization.

    Recently, the non-profit organization faltered on renewing a contract for an annual event fundraiser. As a trustee of the non-profit, once made aware of this oversight. rather than inform the admin, or take action on behalf of the org to renew their contract for the event location, the founder/trustee took it upon herself to take contract — and the event name — for her own profit business.

    The well established yearly fundraiser has now become a for-profit event. The name of the event was barely altered, but the majority of attendees had no idea of the political wranglings that happened behind the scene. I was made aware of this and promptly cancelled my attendance.

    Consequently, the president of the non-profit organization was hand picked and voted in with the insistence/persuasion of this trustee because the previous president was bringing to light the unethical behavior of the org’s relationship with her business.

    As a member of this non-profit organization, I am LIVID that this is allowed to happen. This fundraiser went to support us and put us in the “black” every year. Now, with the lack of income this event was suppose to generate, we are likely to be thrust BACK into the RED. affording this trustee the opportunity to sweep in and save the organization, and consequently solidifying her control over the whole operation.

    What can be done? This can’t possibly be legal!

    The Michigan State Housing Development Authority (MSHDA) takes all allegations of program fraud, waste, and abuse seriously, and has dedicated staff to thoroughly investigate complaints as they are received.

    To report fraud, waste, abuse or gross mismanagement in MSHDA or MSHDA programs, call 517-335-9953 or complete the online Fraud Complaint Form here.

    MSHDA will protect the identity of an individual making a report through the hotline to the maximum extent permitted by law (for example, by using applicable exemptions and exclusions of the Freedom of Information Act). If an individual making a report does do not wish to disclose their identity, they may remain anonymous when contacting the hotline. However, it is important to note that anonymity may impede a quick or thorough investigation or the success of a later prosecution.

    If you have knowledge or allegations of fraud, waste, abuse, or gross mismanagement involving 1602 Funds, call the U.S. Department of the Treasury Fraud Hotline at 800-359-3898. Calls can be made anonymously and confidentially.

    Avoid scams:

    Beware of scammers who use misleading or deceptive tactics, including using MSHDA’s name, to solicit information or money from you:

    • MSHDA is not awarding cruises, store gift cards, or promoting any sweepstakes or contests.
    • MSHDA will never ask for credit card information or refer calls to solicitors who ask for personal information.
    • MSHDA does not offer individual mortgage loans, grants, or financial services to non-Michigan residents.
    • When working with Michigan residents, our services are free.

    Any representations to the contrary are false and should be immediately reported to MSHDA by calling 517-335-9953 or by email. These type of fraud or scam reports may also be made to the Consumer Protection Division of the Attorney General’s office at 517-335-7632, toll free 1-877-765-8388, or online.

    The Michigan State Housing Development Authority (MSHDA) is no longer associated with the telephone number 800-327-9158.

    MSHDA does not work with non-Michigan homeowners and when working with Michigan residents, our services are free. Additionally, MSHDA and/or State of Michigan staff do not conduct a home visit as part of the Step Forward assistance program. Any representations to the contrary are false and should be immediately reported to MSHDA.

    To report fraud, waste, abuse or gross mismanagement in MSHDA or MSHDA programs, call 517-335-9953 or complete the online Fraud Complaint Form here.

    MSHDA will protect the identity of an individual making a report through the hotline to the maximum extent permitted by law (for example, by using applicable exemptions and exclusions of the Freedom of Information Act). If an individual making a report does do not wish to disclose their identity, they may remain anonymous when contacting the hotline. However, it is important to note that anonymity may impede a quick or thorough investigation or the success of a later prosecution.

    Fighting Fraud. Protecting Oregonians.

    • Scam Alert Network Scam Alerts
    • Report Scams & Fraud Report Fraud

    Sales, Scams & Fraud

    • Report Scams & Fraud
    • Search Consumer Complaints »
    • Join the Scam Alert Network »
    • Request Free Fraud Prevention Training
    • Consumer Protection Materials Order Form
    • Medicaid Fraud
    • Free Trial Offers
    • Door-To-Door Sales
    • Gift Cards
    • Timeshares
    • Employment Scams
    • Fitness Clubs & Health Spas
    • Avoid Wildfire Scams
    • COVID-19
    • Price Gouging
    • Telemarketing
    • More Scams & Fraud Resources

    Are you a business owner who received a complaint against your business? Learn about how to respond.

    Learn about preventing scams and fraud: Request free fraud prevention training.

    When to File a Complaint About an Oregon Business

    Not every transaction goes as advertised. Some deals are too good to be true. Sometimes a business will act in a less than ethical way.

    The Oregon Department of Justice is committed to ensuring a fair and safe market place. If you feel you’ve been taken advantage of, there are steps you can take — both online and on the phone.

    If you want to take legal action, please contact a private attorney or file suit in local small claims court ». If you need help finding a lawyer, the Oregon State Bar Lawyer Referral Service » can help.

    How to File a Consumer Complaint About an Oregon Business

    There are two different ways to file a consumer complaint in Oregon:

    Submit a Consumer Complaint Online

    Download the Consumer Complaint Form

    Download the Consumer Complaint Form (PDF) » and submit it with your supporting documents.

    After Submitting a Complaint

    After submitting a complaint, one of three things will happen.

    1. If the complaint falls under the DOJ’s jurisdiction, it will be assigned to an enforcement officer. The officer will send you further information, including a file number and a copy of the letter sent to the business that is the subject of the complaint.
    2. If the complaint is better handled by another government agency, it will be referred to them. You’ll receive a letter alerting you to the referral.
    3. If the complaint was sent for informational purposes only, you’ll receive a letter of thanks.

    If you have any questions, call our Consumer Hotline at 1-877-877-9392

    The Attorney General’s Consumer Hotline is open from 8:30 a.m. to 4:30 p.m., and is staffed by dedicated volunteers who field more than 50,000 calls each year.

    Search Oregon’s Consumer Complaint Database

    Oregon’s Consumer Complaint Database » is built from consumer contacts since January 1, 2008 and is for information only. It may not offer a complete, accurate or comprehensive account of every incident. Several factors, including a company’s size and volume of transactions, may affect the likelihood of a complaint being filed.

    Join the Oregon Scam Alert Network

    The Scam Alert Network provides up-to-the-minute information about scams, frauds and other threats to consumers. Click the link below and enter your email address to be added to the network. We won’t share your email address, and we’ll only send scam alerts.

    Complaints About a Charity or Solicitation

    The Oregon Department of Justice Charitable Activities Section » supervises and regulates the activities of charitable organizations in the state.

    If you want to file a complaint about a charitable non profit or solicitation, use the online form » or mail a completed form or letter to:

    Charitable Activities Section
    Oregon Department of Justice
    100 SW Market St.
    Portland, OR 97201

    Note that complaints filed with the Charitable Activities Section may become part of public record. If you are concerned about confidentiality, please call us at 971-673-1880 before submitting your complaint so that we can discuss your request for confidential treatment.

    Report Elder Abuse and Neglect

    Fighting elder abuse is a top priority for the Oregon Department of Justice (DOJ) and Attorney General Ellen F. Rosenblum.

    Possible elder abuse should be reported through Oregon’s toll-free hotline:

    1-855-503-SAFE (7233)

    or on the DHS website ». If it is an emergency please dial 9-1-1.

    Victims of elder abuse may be slow to recognize and report the abuse. Learn more about the warning signs of elder abuse » and about what Oregon’s Attorney General is doing to combat elder abuse ».

    Report Medicaid Fraud

    If you suspect Medicaid fraud may be occurring in Oregon, please file a report by doing one of the following:

    • File a fraud allegation report online »
    • Call the DHS Fraud Hotline at 1-888-372-8301 (8:00 am to 5:00 pm Pacific Time)
    • Fax your written complaint to 503-373-1525. Address your fax to ATTN: HOTLINE
    • Mail your written complaint to:

    Investigations Unit
    P.O. Box 14150
    Salem, OR 97309

    Please use one method as all complaints are processed by the same Client Fraud Hotline Coordinator.

    Report a Do Not Call Violation

    Is Your Number on the National Do Not Call List but Still Getting Unwanted Sales Calls?

    If you are receiving telemarketing calls even though your number is registered with the National Do Not Call List, please submit a complaint on the National Do Not Call List » website.

    The funds of small nonprofits are often in the hands of just a few, with very little upper management types to report to. With the number of hands in the treasury so limited, it might be tempting, for some, to do dishonest things with the funds. It’s the “who’ll miss this $20 from the cash box” mentality. Worse yet, with small groups, false accusations are also not uncommon. That’s why it’s important to cross your t’s and dot your i’s when it comes to managing a nonprofit’s treasury.
    By following these steps, you will not only prevent nonprofit treasury fraud, you will also protect the honest members of your organization from being falsely accused of any wrongdoings:

    • Always have at least 2 people count money
    • Use a standard counting sheet that both counters sign
    • Reconcile the amount taken in with the amount banked (if you had 12 members sign up, and each membership is $10, you should have $120 to deposit)
    • Give receipts for money received (this can be a copy of the counting sheet)
    • Require 2 signatures on each check (it may be expensive to have your bank do this, but you can audit this yourselves after the fact by looking at your returned checks)
    • Keep all voided checks – do not destroy them!
    • Don’t pay for anything with cash
    • Ensure that a board member that is not a signer on the account verifies bank statements against the treasurer’s report every month and have the person sign the statement to show that they have done this.
    • Create a paper trail for clarification in case questions arise at a later date:
      • Use duplicate bank deposit books (these have a carbonless copy of your deposit slip that stays in the book)
      • Identify each deposit slip with the activity for which it was received
      • Record every check by name on the deposit slip – even when there are many! (When you are trying to figure out if Jane paid for that T-shirt, that adding machine tape won’t help you much.)
      • Photocopy all checks you receive as payment. These will reconcile against your deposit slip
      • Use duplicate checks (carbonless copy) for all the checks you write
      • Get cancelled checks returned to you OR (even better) choose a bank that supplies check images with your monthly statement.
      • Design and use a standard Check Request Form for every check without fail

    Organize your information for efficiency:

    • Use a 3-ring binder with monthly dividers
    • Have a plastic sheet protector for each month to put all the odd things you get (like the notice from the bank about an NSF check) that you don’t want to throw out but you don’t know what to do with
    • Store Check Request Forms with the receipt attached in check number order by month (use tape to attach the receipt to the back of the Check Report Form – all those staples in the top left corner really jam up your binder)
    • Ensure that every check written has a Check Request Form
    • Store voided checks in check number order or in that plastic sheet protector
    • Store bank statements and reconciliations
    • Store the treasurer’s report for each month (work from the bottom up: if your financial year goes from January to December, put the plastic sheet protector in the binder on the right side; then check #1, then check #2 etc for the month; then your reports, then the divider tab that says January, then do February. Usually recent items are the ones you need to access most frequently, and they will be right at the top where they are easiest to find.

    According to public studies recently undertaken by the accounting firm Ernst & Young, LLC and the Association of Certified Fraud Examiners (ACFE), reports of fraud within nonprofits appear to be increasing at an alarming rate. More than 13% of total reported fraud cases in the American work force took place at nonprofits according to ACFE. And the Ernst & Young study found that one out of five workers personally knew of fraud in their workplace.

    Scandal and fraud have dominated the headlines in recent years both at publicly traded companies and in the nonprofit sector. Author Gerald Zack, a certified public accountant and founder of the Nonprofit Resource Center, which works with external auditors of nonprofits, says that the potential damage to a nonprofit’s reputation may be harder to reverse than it is for a for-profit organization. Today’s public seems to be highly unforgiving of nonprofit institutions that breach their trust. In a climate of media-inflamed low public trust of charities, organizations must take action to prevent fraud and abuse before their reputations and financial support are irreparably damaged.

    Fraud and Abuse in Nonprofit Organizations demonstrates how nonprofit organizations are vulnerable to fraud. Through examples and case studies, the author recommends best practices for avoiding controversial situations, and even the appearance of financial impropriety. The book describes the most common fraud and abuse schemes committed against nonprofits, and focuses on the creation of a comprehensive fraud awareness and deterrence system that goes beyond standard internal financial controls.

    Over and above outright theft, the book also focuses on frauds committed on behalf of nonprofits, or otherwise attributed to the charity such as fundraising irregularities and improper financial reporting to donors. Divided into five sections, the book presents a model for detection and prevention, specific financial controls, the development of administrative systems, and the role of management and the Board of Directors in providing oversight and analysis. Examples of policies and checklists are also provided.

    Gerald M. Zack is director of an accounting and consulting firm that specializes in working with nonprofit clients. He has more than 20 years of experience and is a well-known lecturer and trainer.

    The philosophy underlying Fraud and Abuse is that you need to have systems in place to prevent fraud before even the hint of suspicion falls on your organization. Today’s donors and the general public may have higher expectations of the nonprofits that serve our communities than they did in the past. Hence, resources like Fraud and Abuse in Nonprofit Organizations become an important addition to nonprofit managers’ bookshelves.

    For citations to other materials on this topic, refer to the Literature of the Nonprofit Sector Online, using the subject headings “Nonprofit organizations-accounting” or “Risk management.”

    Lang, Andrew S. and Tammy Ricclardella. Preventing Fraud: How to Safeguard Your Organization. Washington, D.C.: National Center for Nonprofit Boards, 2001.

    Lambert, Joyce and Daphne Main “Reduce Your Losses From Error and Fraud.” Nonprofit World, vol. 16, September-October 1998, p. 46-48.

    • Category :
    • Nonprofit

    How to report nonprofit fraud

    Non-profit organizations fulfill a vital role in society. These companies provide services for the people who are most in need. While non-profits may believe that their employees share their altruism, they are unfortunately sometimes the victim of fraud.

    In many non-profit fraud cases, the people who commit fraud are those who are in positions of authority and are highly trusted within their organizations. If you are a member of a non-profit company, here is what you need to know about fraud in non-profits and implementing better management strategies.

    How common are non-profit fraud cases?

    Non-profit fraud cases happen much more frequently than you might think. According to a study by researchers at Harvard that was published in the journal Non-profit and Voluntary Sector Quarterly, non-profit organizations lose an estimated 6 percent of their annual revenues to fraud each year for a total loss that is estimated at $40 billion.

    Non-profit organizations may be targeted by internal and external thieves because they may not have strong controls in place. Some non-profit agencies are also hesitant to report thefts because of a concern that their reputations might be harmed, leading to fewer donations.

    Fraud in non-profits is commonly perpetrated by people who are in trusted positions of authority such as executives or accountants. However, fraud may also be perpetrated by lower-level employees as the following case demonstrates.

    Non-profit fraud case study: Administrative assistant steals $5.1 million

    In an egregious case of non-profit embezzlement, a 44-year-old administrative assistant, Ephonia Green, who worked at the Association of American Medical Colleges, stole $5.1 million over an eight-year period from the non-profit organization. The organization, which is located in Washington, D.C., administers the Medical College Admissions Test and represents universities and colleges across the nation.

    Green reportedly created fake company names that were close to the names of actual vendors. She would then create invoices in the names of the fake companies so that checks would be issued to them. Finally, she would deposit the money into her own personal accounts. Green used $1.8 million to keep a bridal shop that she owned afloat. The long fraud scheme fell apart when a bank noticed that something was amiss. She was sentenced to serve 46 months in prison.

    Non-profit fraud case study: Bookkeeper steals $800,000 that was meant for veterans

    In another non-profit fraud case, a 54-year-old Connecticut woman named Deirdre M. Daly reportedly stole $800,000 from the National Veterans Services Fund, a non-profit organization that provides social services and medical help to veterans of the Vietnam and Persian Gulf Wars and their families.

    Daly worked as a bookkeeper at the organization. During a five-year period from 2009 to 2014, she diverted $800,000 from the organization to pay for her own needs and made fraudulent entries into the organization’s books to cover her tracks. She was prosecuted in federal court by the U.S. Department of Justice and was sentenced to two years in federal prison followed by three years of parole. She was also ordered to pay full restitution to the NVSF for her non-profit embezzlement.

    Ways to prevent non-profit fraud cases

    There are several ways that non-profit companies can prevent fraud. Nerd Wallet recommends a number of risk management strategies that non-profits can implement to help to reduce their fraud risk. They should always have multiple people responsible for different tasks such as counting donations and reconciling accounts. Access to the organization’s accounts should be severely restricted.

    Non-profits should implement strong accounting practices, including software, surprise audits, and regular reconciliations. It is better for non-profits who can qualify for credit to use credit cards instead of cash or checks. This can help to track purchases more easily a reduce non-profit fraud cases. Non-profit organizations that do not have sufficient credit histories to secure credit cards may want to use non-profit debit cards because they come with strong internal controls.

    Non-profits can limit the cards’ use to specific transactions and set limits on the cards by the day, week or month. They can also view the cards’ transaction histories at any time from their secure dashboards and turn off an individual card immediately if they see misuse.

    Bento for Business’s Visa debit cards make for great non-profit debit cards and automatically upload transaction data into the organizations’ existing accounting software. They can help to prevent fraud before it starts. Deposits that are made into the account that funds the cards are insured by the FDIC up to $250,000.

    Approval for the cards does not depend on your organization’s credit history, and there is a 60-day free trial so that you can see if the cards will work for your organization. Call us today at 866.220.8455 to learn more, or start a free 60 day trial.

    OIG’s Hotline provides a mechanism for any individual to confidentially report fraud, waste, and abuse related to programming or operations for which OIG provides oversight.

    Federal employees are required to disclose waste, fraud, abuse, and corruption to appropriate authorities, such as the Office of Inspector General.

    Contractors and grantees implementing projects with U.S. funds must comply with mandatory disclosure requirements (pursuant to Federal and agency-specific procurement and assistance rules), in reporting allegations of fraud and misconduct. Employees of such organizations may also submit complaints to the Hotline directly, should they so choose.

    OIG’s Hotline staff is responsible for receiving and processing allegations in support of investigative activities. For each submission received, a Hotline investigator conducts a review of the information provided in considering the most appropriate course of action. The Hotline investigator may reach out to the individual or organization submitting the report for additional information, as needed.

    All submissions to the Hotline are housed within a secure database to ensure protection of all personally identifiable information, in accordance with applicable U.S. legal authorities. Absent consent, OIG will not disclose the name of any individual submitting a report to the Hotline, unless the Inspector General determines that disclosure is unavoidable during the course of an investigation.

    Please note that due to the high volume of submissions we receive, we do not provide updates on the status of complaints or other submissions to the Hotline.

    Individuals or entities may submit information to the Hotline as follows:

    Completing an online form on our website

    How to report nonprofit fraud

    At any given time, you can do a Google search for “fraud -embezzlement- nonprofits” and have several news stories come up on how a trusted person has bamboozled funds from a nonprofit. Fraud is always a threat to nonprofit organizations. Tight budgets and staff shortages often contribute to a lack of oversight and prevention measures.

    Many nonprofits are based on charity, goodwill, and a genuine need to help others, so often trust is just part of the fabric. This makes nonprofits more vulnerable, and the cost of vulnerability is a high one.

    As highlighted in this excerpt from the ACFE’s 2020 Report to the Nations “…nonprofit organizations were the victim in 9% of fraud cases reported by CFEs in the study — with a median loss per instance of $75,000 and an average loss of $639,000. Of these cases, nonprofit employees were more likely to commit fraud (39%), but those at the director and board level tended to steal more ($250,000 compared to $21,000 by employees).”

    The impact of a fraud event on a non-profit can include the loss of dollars and loss of donors and loss of reputation.

    Fraud can occur in many different ways, including using fake invoices, payroll fraud, embezzlement, misappropriation of company credit cards, fraudulent expense reports and others.

    Nonprofits have some unique factors that make you more susceptible to fraud. For instance, if you have a fundraising board who does not have a high degree of financial experience, that can be an opportunity for fraud. Team members wearing too many hats at a nonprofit can be another factor. As a nonprofit organization, sometimes you run lean on staffing. But if you’re putting all the financial responsibilities on one person, you might not have sufficient check and balances built into the nonprofit that are needed for managing funds closely at your nonprofit.

    Training is an important component to reducing opportunity for fraud, especially training on regular audit reviewing practices that reduce fraud opportunities. It’s also valuable to maintain training on how to spot potential fraud and become knowledgeable about the new ways to commit fraud that are occurring. Employee turnover can also play a part in fraud because when you have a high employee turnover, you might have more instance of fraud.

    Lack of internal controls is also another contributor. One piece of internal control that nonprofits can utilize is doing background checks on any potential employees. Sometimes people who commit fraud will simply move to another nonprofit and do the same thing at the new nonprofit. Strong checks and balances in place from the accounting perspective can also significantly reduce opportunities for fraud.

    Why does fraud occur?

    Financial pressure. According to researchers, the biggest reason people commit fraud is because they need or want the money. Economic factors can influence someone who was a trusted person to commit fraud. Rationalization is another factor you’ll see, where for instance someone who takes a little cash at a time with the idea they will eventually pay it back. Opportunity is another factor, so putting checks and balances in place make it harder for someone to have the opportunity to commit fraud.

    Detecting and preventing fraud – 3 tips internally

    How to report nonprofit fraud

    1. As a nonprofit get a board with a mix of talent on your board so that you will have folks that can serve too as part of your checks/balance team.
    2. Ensure your internal controls are formally documented, well-understood and strongly enforced. Post them on the walls in your office.
    3. Foster a culture of awareness, open communication and transparency for employees, donors and stakeholders.

    Ensure you train all employees on fraud protection. Make sure you have implemented a fraud reporting mechanism in place so all employees know they can report fraud if they see it. Let them know the impacts of fraud on your mission and your stakeholders.

    Monitoring your data

    Data. Data. Data. Tracking your data is another valuable way to not only deter fraud, but also to find fraud. Data monitoring, analyzing of data and surprise audits correlate with the largest reductions in fraud loss and duration of loss. Surprisingly, many nonprofits have still not implemented these deterrents as a regular part of their overall fraud deterrent program. Consistent data monitoring in accounts payable and the billing provide a significant overall benefit of fraud reduction.

    For instance, in accounts payable look for these red flags:

    • Check tampering
    • Unfamiliar vendors
    • Sudden increases in purchases from one vendor
    • Vendors with only a P.O. Box for contact
    • Vendor addresses that match employee addresses

    In transactions and reimbursements these might be red flags:

    • Misclassifications of transactions
    • Transactions conducted at unusual times of day or evening, or holidays outside of M-F work hours
    • Transactions that are multiple or occurring more frequently or less frequently than expected

    On documentation here are red flags:

    • Missing or altered documents
    • Evidence of backdated documents
    • Missing or unavailable originals
    • Questionable or missing signatures

    Do you have an accounting system that will ensure fraud protection efforts including enabling alerts, masking of sensitive account information in the data, and the ability to set user rights? This is also a key to reducing embezzlement and frauduent activities. The more controls and restrictions you have in place within your software program, the more you will be able to reduce the opportunity to commit it.

    MIP is committed to helping reduce fraud and we encourage you to contact us for a demo on how our software provides strong checks and balances to help reduce potential fraud opportunities. . To register for the demo go here .

    Rewards for Reporting Fraud against the Government

    This article tells you how to get a reward for reporting fraud against the government. If you report fraud against the federal government or a State entity you can get a significant monetary reward. But there are very specific rules and requirements you must follow when you report fraud against the government or you will not be eligible for a reward.

    This article outlines the basics for how to apply for a reward and how to properly report fraud against the government.

    First, you cannot simply call a hotline to report fraud against the government. Even if you report everything you know to a government agent and they use your information to collect millions, you will not get a reward. That’s because you must follow the process in the reward statute to be eligible for a reward.

    Specifically, to receive a reward for reporting fraud against the government you must hire an attorney and file a qui tam civil lawsuit that alleges the fraud being committed against the government. This may sound expensive, but most experienced attorneys handling whistleblower reward cases work on a contingency basis for filing your reward application for reporting fraud. But it is important that you select an experienced attorney.

    Second, you must report specific and detailed information about the fraud against the government. The government turns down 75 percent of reward applications, so it’s very important that you and your attorney provide the information in a clear and convincing manner and follow the right procedures for reporting fraud against the government. It also helps if you worked for the company that is defrauding the government—even if you were asked to participate in the fraud, because the government needs information about how the fraud scheme against the government worked in order to win a fraud case and collect the money back.

    Third, the size of the reward is determined by the size of the fraud. If a company is cheating the government by $100,000 you would only get a reward of around $15,000. That’s because a reward for reporting fraud against the government is between 15 and 25 percent of the amount the government actually gets back from the company defrauding the government. Because you will have to pay taxes and give a portion to your attorney as a contingency fee for helping you report fraud, it may not be worth your time unless the amount of fraud against the government is in the millions. To receive a million dollar reward for reporting fraud, the amount of fraud against the government needs to be $7 million or more.

    This website (and the books authored by Mr. Hesch) walk you step-by-step through the process of reporting fraud against the government and shows you how to apply for a monetary reward. But here is a quick example of how to report fraud against the government and claim a whistleblower reward.

    If someone defrauds the government, such as lying about goods or services used under any government program (such as Medicare) or on contracts (such as the military or Homeland Security), they are liable to the government to repay triple the amount of the fraudulent request for payments.

    If you work for the company that is committing fraud against the government, you might be eligible for a reward. The first step is to contact an experienced False Claims Act attorney to assess your case. But do not delay. Only the first whistleblower to properly follow the procedures for reporting the fraud against the government is eligible for a reward. You can decide not to report the fraud after you talk to an attorney and learn about the risks of being a whistleblower.

    Once your attorney files the complaint and reward application for reporting fraud against the government, the government agency that was defrauded will evaluate your allegations. This can take between six months and three years. Afterwards, the government will inform you if it plans on pursuing the fraud allegations you reported. If it does, in over 90 percent of cases, the whistleblower receives a reward for reporting fraud.

    The amount of the reward depends on how much money the government collects from the company for committing fraud against the government. Remember, the reward is between 15 and 25 percent of what the government actually collects.

    Because there are risks for reporting fraud against the government, you should talk to an attorney experienced with reward cases before you blow the whistle and report fraud. There is a lot to consider and you need to know whether and how to properly report fraud against the government to get a monetary reward.

    Mr. Hesch is available to review your information and decide if you have the right kind of a case to report fraud against the government. The rest of this website provides more details regarding what it takes to report fraud against the government and how to get a reward.

    See the link at the bottom of the page below “Do I have a case” to have Mr. Hesch review your potential case for how to get a reward for reporting fraud against the government.

    See the link at the bottom of the page below “Report Fraud” to learn more about how to get a reward for reporting fraud against the government.

    Message [Page 1 of 1]

    1 Dandy Boy Shilcock and Dannion Brinkley on Tibetan Rainbow Body! PLUS How to Report Fraud in a Nonprofit Organization #STOPBLUECHICKEN501C3FRAUD Mon Jun 29, 2020 9:42 am

    PurpleSkyz

    How to report nonprofit fraud


    https://youtu.be/S-DvF7KOeGQ

    How to Report Fraud in a Nonprofit Organization

    November 8, 2012 at 10:35 AM

    While organizations such as charities and religious groups are given nonprofit status, abuses can still occur. As much as $40 billion annually has been lost due to fraudulent activity by nonprofit organizations. If you suspect that a nonprofit organization you are working for or have contributed to is guilty of fraud, It is important to know how to effectively report it, so that it can be stopped.

    1. Lodge a complaint with the Better Business Bureau. If, for example, you have been a contributor to a nonprofit organization and believe monies have been misused, go directly to BBB’s website at www.bbb.org/us/charity/ and file a complaint. Provide your contact information and give specific details about why you are filing a complaint. Be aware that the BBB gives the charity or nonprofit a chance to deny or resolve the issue.You can also write your complaint and mail it to: BBB Wise Giving Alliance, 4200 Wilson Blvd., Suite 800, Arlington, Virginia 22203. Once you report a charity or nonprofit, your complaint will remain a matter of record with the BBB, so that future potential contributors will be forewarned.

    2. Contact the Internal Revenue Service with your suspicions. Go to the IRS website at www.irs.gov and fill out their Form 13909. Print it out and mail the completed form, along with any supporting documentation, to: IRS EO Classification, Mail Code 4910DAL, 1100 Commerce Street Dallas, TX 75242-1198, or fax to 214-413-5415 or email to [email protected] Supplying specific examples and documentation to back up your claim, such as copies of files, financial reports and transcripts that show inconsistencies, will bolster your credibility. If the IRS feels that you have provided adequate evidence of fraud, it will investigate.

    3. File a complaint with the Association of Certified Fraud Examiners chapter nearest you. You can find that chapter by going to www.acfe.com. Upon receipt of information that substantiates your claim of fraud, they will investigate and come up with their own findings.

    4. Report fraud suspicions to the U.S. Postal Inspection Service. If a nonprofit organization has been sending out letters requesting contributions that have not been used as promised, this constitutes mail fraud. You can fill out a complaint form at postalinspectors.uspis.gov/forms/MailFraudComplaint.aspx .

    5. Go to the media. If you believe that a nonprofit organization has committed fraud, get in touch with a local newspaper or television news station. Be prepared to provide as much information as you can, such as documentation, financial reports and witnesses, to back up your claims. If they feel your suspicions are merited, they may do an investigative report that exposes the fraud.

    Health care fraud is not a victimless crime. It affects everyone—individuals and businesses alike—and causes tens of billions of dollars in losses each year. It can raise health insurance premiums, expose you to unnecessary medical procedures, and increase taxes.

    Health care fraud can be committed by medical providers, patients, and others who intentionally deceive the health care system to receive unlawful benefits or payments.

    The FBI is the primary agency for investigating health care fraud, for both federal and private insurance programs.

    The FBI investigates these crimes in partnership with:

    • Federal, state, and local agencies
    • Healthcare Fraud Prevention Partnership
    • Insurance groups such as the National Health Care Anti-Fraud Association, the National Insurance Crime Bureau, and insurance investigative units

    How to report nonprofit fraud

    Report Health Care Fraud

    We need your help to identify, investigate, and prosecute this crime. If you suspect health care fraud, report it to the FBI at tips.fbi.gov, or contact your health insurance provider.

    Tips for Avoiding Health Care Fraud

    • Protect your health insurance information. Treat it like a credit card. Don’t give it to others to use, and be mindful when using it at the doctor’s office or pharmacy.
    • Beware of “free” services. If you’re asked to provide your health insurance information for a “free” service, the service is probably not free and could be fraudulently charged to your insurance company.
    • Check your explanation of benefits (EOB) regularly. Make sure the dates, locations, and services billed match what you actually received. If there’s a concern, contact your health insurance provider.

    Common Types of Health Care Fraud

    Fraud Committed by Medical Providers

    • Double billing: Submitting multiple claims for the same service
    • Phantom billing: Billing for a service visit or supplies the patient never received
    • Unbundling: Submitting multiple bills for the same service
    • Upcoding: Billing for a more expensive service than the patient actually received

    Fraud Committed by Patients and Other Individuals

    • Bogus marketing: Convincing people to provide their health insurance identification number and other personal information to bill for non-rendered services, steal their identity, or enroll them in a fake benefit plan
    • Identity theft/identity swapping: Using another person’s health insurance or allowing another person to use your insurance
    • Impersonating a health care professional: Providing or billing for health services or equipment without a license

    Fraud Involving Prescriptions

    • Forgery: Creating or using forged prescriptions
    • Diversion: Diverting legal prescriptions for illegal uses, such as selling your prescription medication
    • Doctor shopping: Visiting multiple providers to get prescriptions for controlled substances or getting prescriptions from medical offices that engage in unethical practices

    Prescription Medication Abuse

    Creating or using forged prescriptions is a crime, and prescription fraud comes at an enormous cost to physicians, hospitals, insurers, and taxpayers. But the greatest cost is a human one—tens of thousands of lives are lost to addiction each year. Protect yourself and your loved ones by following this guidance:

    • If you are taking opioids, take them exactly as prescribed by your doctor, ideally, for the shortest amount of time possible.
    • Never share your medication with others.
    • Explore non-opioid options with your doctor.
    • Learn more about the risks of opioid use from the CDC.
    • If you have unused or expired pain medications, take them to a DEA-approved take back site for disposal.

    Protect Yourself and Report the Latest Frauds, Scams, Spams, Fakes, Identify Theft Hacks and Hoaxes

    Search ConsumerFraudReporting.org

    There are affiliate links on this page. Read our disclosure policy to learn more.

    How to Report a Scam

    If you have observed a scam or been the victim of a scam, spam or fraud and want to report it for enforcement, here is a list of where to report different types of scams in the US, UK, Canada and many other countries. In some cases there is more than one agency to contact. Some scams fit into more than one category, also.

    In all cases, you can start by reporting it to us, using this form. We will use the information to warn other consumers and help you to direct it to law enforcement agencies.

    Report to the business involved: If the scam uses the name of a business (like Amazon, Chase Bank, Wells Fargo) or you were scammed by someone on their platform (like eBay), you can report it to that business.
    Click here for many businesses reporting numbers and email addresses.

    FTC: Next, the Federal Trade Commission’s online complaint tool is the main tool to reporting a problem or scam to the government.
    They won’t likely get your money back, but at least you will help them to catch the scammer.

    Complain to the company, assuming it is a legitimate company. If you are polite, but persistent, you may get a areplacement or refund.

    Another catch-all for bringing internet scams to the attention of the FBI and FTC is the U.S. government’s Internet Crime Complaint Center (IC3)
    at Internet Fraud Complaints Center.

    FBI: To report a fraud, scam or crime to the FBI (the Federal Bureau of Investigation), find the phone number for your nearest local FBI office? See this page to find the closest office!

    But to protect your finances, identity and in some cases, identity, you will generally also want to report the scam directly to another specific agency – see further down this page for specific directions.

    Be sure to contact your bank or credit card company if you have given out credit card numbers, bank account information, etc.

    And we will track and post more examples, so once again, please forward a copy to us – see the email address at the top of this page or cut and paste the email into our feedback form!

    In the United States:

    • The Federal Trade Commission’s online complaint tool is the main tool and your first stop to reporting a problem or scam. You can file a complaint here for many types of complaints, such as scam emails, phone calls claiming to be from the IRS, FBI or another government agency, identity theft scams, spam, telemarketers, educations scams, jobs scams.
    • Reporting Advance Fee Frauds (also called Lottery scams, Money Transfer Frauds, Lawyerswith deceased clients, widows and orphans with money to transfer, AFF Scams, Nigerian scams, etc.
    • Reporting abusive use of email accounts (to send scams or spams or receive responses)
    • Filing complaints against a business
    • Reporting crimes
    • Reporting identity theft
    • Reporting medical frauds
    • Reporting fake websites (called Phishing and Spoofing)
    • Reporting Postal / Mail scams
    • Reporting scams on the internet
    • Reporting Securities and stock frauds
    • Reporting Spam (unsolicited business emails)
    • Reporting stolen checks
    • Miscellaneous scams
    • Other useful U.S. Agencies and Websites
  • Reporting Spams and Scams in Other Countries

    Reporting to Email account providers

    You can report spams and scams that are coming from specific email accounts to the providers. For example, if a scammer is using a Hotmail account to send scams or spams or receive replies, you can report it to Hotmail. Be sure to forward the email and copy it’s headers (click here to see how) into the email you send to the provider . That helps them to trace the source. See this page for the reporting addresses for the major email account providers.

    En español | Americans contributed more than $471 billion to charity in 2020, according to the Giving USA Foundation’s annual report on U.S. philanthropy. That generosity supports many amazing organizations that put those billions to work for health care, education, environmental protection, the arts and numerous other causes.

    Unfortunately, it also opens a door for scammers, who capitalize on donors’ goodwill to line their pockets.

    Many such frauds involve faux fundraising for veterans and disaster relief. Scammers know how readily we open our hearts and wallets to those who served and those rebuilding their lives after hurricanes, earthquakes or wildfires. Charity scammers are especially active during the holidays, the biggest giving season of the year.

    They also follow the headlines: The coronavirus pandemic brought a bevy of phony appeals to donate to victims or emergency response efforts, as has the war in Ukraine.

    Have you seen this scam?

    • Call the AARP Fraud Watch Network Helpline: 877-908-3360
    • Report it on AARP’s Scam-Tracking Map

    Sign up for Watchdog Alerts for more tips on avoiding scams.

    4 Ways to Avoid a Charity Scam

    Sham charities succeed by mimicking the real thing. Like genuine nonprofits, they reach you via telemarketing, direct mail, email and door-to-door solicitations. They create well-designed websites with deceptive names. (Cybersecurity firm DomainTools noted a huge jump in URL registrations with the words “Ukraine” and “Ukrainian” in the days after Russia’s invasion.)

    Some operate fully outside the law; others are in fact registered nonprofits but devote little of the money they raise to the programs they promote. Federal and state authorities who shut down a massive fundraising network in March 2021 said the affiliated companies pocketed as much as 90 cents on the donated dollar as they bombarded consumers with illegal robocalls and deceptive appeals to support homeless veterans, cancer patients and autistic kids.

    With a little research and a few precautions, you can help ensure your donations go to organizations that are genuinely serving others, not helping themselves.

    Be “smart” while watching TV – read about the latest smart TV scam trend.

    Fraud Prevention Tips

    The most important advice for becoming a
    smarter consumer and avoiding fraud

    File A Complaint

    Think you’ve been scammed? Help fight fraud by
    reporting your experience to us.

    What we do

    Fraud.org is a project of the National Consumers League (NCL), a nonprofit advocacy organization based in Washington, DC. NCL was founded in 1899 to promote the interests of consumers and workers in the United States and abroad. Over its long history, NCL staff have dedicated themselves to this mission through investigation, public interest advocacy, and consumer education.

    2021 Top Ten Scams

    Each year, the National Consumers League analyzes the thousands of complaints received at Fraud.org from consumers to track trends in scams and fight fraud. Learn about this year’s trends.

    Fake Rx Action Center

    C ounterfeit drugs are on the market today, causing harm and even death. Get the important, life-saving tools you need to protect yourself and your loved ones from fake drugs and illegal online pharmacies

    Contact our Experts

    Fraud.org is a project of the National Consumers League, the 120+ year old watchdog organization fighting for increased consumer protections. The NCL team that runs Fraud.org has decades of experience investigating scams and how criminals operate, monitoring trends, and counseling consumers.

    Data Breach Epidemic

    Data breaches have become a way of life for anyone who has ever used a credit or debit card. When hackers compromise data stored by retailers, agencies, and services, our personal info is exposed to future risks. What can you do to protect yourself?

    Sign Up For Fraud Alerts

    Sign Up For Fraud Alerts

    Fraud.org Gets Results

    Charlotte P., Florida

    Total saved: $10,000 / Work-at-home scam
    “I don’t know how to thank you, but if you were here I would give you a hug for saving me from getting ripped off. Thank you so much.”

    Tax fraud is one crime that has become prevalent in many countries/states. The misdeed occurs more often than you can imagine. According to an IRS report released in 2019, the net tax gap was estimated at $381 billion. Many nationalities regard tax fraud as a trivial offense and commit it frequently. The amount you evade may seem too little to affect your state/country, but before you know it, you owe the government a considerable amount.

    If you are a responsible citizen, you should report such mischief to the IRS immediately you notice it. However, you may wonder how to report someone to the IRS anonymously. Do not worry; DoNotPay has your back. Reporting tax fraud can be an intimidating process; that is why DoNotPay steps in with our new tax fraud product that gives you a fast, easy and convenient way to handle the process.

    What Exactly is Tax Fraud?

    Tax fraud is an act where an individual or business entity willfully and intentionally provides false information on a tax return to minimize the liability or avoid paying the tax obligation altogether.

    The tax fraud qualifiers that investigators look into include:

    • False exemptions or deductions
    • Kickbacks
    • A false or altered document
    • Failure to pay tax
    • Unreported income
    • Organized crime
    • Failure to withhold
    • Failure to follow the tax laws

    Why Is It Important To Report Tax Fraud?

    Always consider it your obligation to report tax fraud if you’re a responsible citizen. Some of the reasons to report someone for not paying tax include:

    • Reporting tax fraud can be lucrative for the reporter as they may get compensation/reward from the IRD.
    • Tax fraud incapacitates any government’s allocations to critical areas like schools, compensation of elderly citizens, and hospitals, among others.
    • Tax fraud cripples the global economy by lowering the trading abilities of individual nations.

    How to Report Someone to the IRS on Your Own

    The IRS provides two ways to process tax fraud ー by filling in and submitting form 3949-A or writing a letter to the IRS. However, if you don’t want to fill in the form to report someone to the IRS, the letter you send should indicate as much information as possible. Ensure the following details appear in the letter:

    1. The name of the person or business entity you’re reporting
    2. The person’s Social Security number or the business’ employer identification number
    3. Descriptive information about the tax fraud you’re reporting and how you learned about the crime
    4. Any unreported income’s estimated cash amount
    5. Duration of the suspected tax fraud
    6. Your name, address, and telephone number. (You are not required to identify yourself, but this information is helpful to IRS investigators)

    Next Steps to Report Someone to the IRS if You Can’t Do It on Your Own

    In a case where you can’t report someone to the IRS on your own, you can find someone to do it on your behalf. Government agencies provide consumer protection divisions mandated to help you with the reporting process.

    If you aren’t sure how to go about this, you can visit the IRS Identity Theft Resource Center to find help. You can also call 1-800-366-4484 (1-800-877-8339 for TTY/TDD users), and you’ll remain anonymous.

    The process can be long and exhausting when you choose to do it on your own. However, DoNotPay has your back. Its new tax fraud product allows you to report someone to IRS for not paying taxes with one tap of a button.

    How Can You Report Someone for Lying About Their Taxes With the Help of DoNotPay

    If you want to report tax fraud but don’t know where to start, DoNotPay has you covered. Create your own cancellation letter in 5 easy steps:

    1. Open the DoNotPay Report Tax Fraud product.
    2. Enter the business you would like to report for tax fraud.
    3. Provide the details of suspicious activity and as much evidence as you can provide.
    4. Confirm your contact information.
    5. DoNotPay will automatically generate the official report and send it on your behalf. The IRS will contact you regarding cash rewards once the case is investigated.

    Why Use DoNotPay to Report Someone to the IRS

    DoNotPay is the best solution for your needs for the following reasons:

    Fast It won’t take you long to submit your report to the IRS.
    Easy With DoNotPay, you don’t have to put much effort into filling forms for the report. All you need is to follow the given five simple steps to solve your problem.
    Successful You can rest assured knowing we’ll make the best case for you.

    DoNotPay Works Across All Companies/Entities/Groups With the Click of a Button

    Many companies and entities, including government agencies, work with DoNotPay to solve various problems. Besides tax fraud, DoNotPay handles situations regarding the following:

    Find more details on the DoNotPay page.

    Frequently Asked Questions

    1. What happens when you report someone to the IRS?
    2. Can you anonymously report someone for tax evasion?
    3. Where do you report fraud to IRS?
    4. What happens if you report someone for tax evasion?
    5. How to report someone for a tax audit?
    6. Where can you report if a person that you know is filing a tax fraud?

    What Else Can DoNotPay Do?

    It’s prudent to report tax fraud to the IRS if you have any information. DoNotPay is the right channel to do so. Our new tax fraud product allows you to disclose any company or entity with suspected tax fraud smoothly. If you know about any fraudulent information such as:

    Do not hesitate. Report it immediately using DoNotPay.

    How to Report Scams to the Police

    Related Articles

    • How to Report Scams to the Police
    • How to File a Fraud Report With Police
    • How to Report Auto Scams
    • How to Report International Fraud

    Whether on the internet or on your doorstep, scam artists can hit you anywhere. If you’ve been the victim of fraud, you’re not alone. In 2016, the Federal Trade Commission (FTC) received 1.3 million fraud reports, representing a total of $744 million paid to scammers.

    If you even suspect you’ve been taken in by a scam artist, the best thing is to report the activity as soon as possible. Start local, and go all the way up to the federal level if necessary. The faster you act, the more likely law enforcement will be to track down the suspect. Early reporting also gives you a better chance of recovering your property.

    Gathering Information to Build Your Case

    Before you start filing a complaint, pull together all the documents and information you have about the fraud or scam. If the scam artist sent you emails, make copies of them. If you sent the person any money, get bank statements that show the transactions. You want anything and everything you have that is related to the incident. However, don’t hold off reporting fraud just because you think you don’t have enough information. Any information you have will be valuable.

    Draft a basic timeline of the incident; this may help you make a more concise statement. If you fell victim to an email scam, the person likely sent you more than one email. Starting with the first one, write a brief summary of the communication after the date. Include all communication and transaction details.

    If credit cards or bank accounts were involved, write down your account numbers and have those handy. You may want to contact the bank or credit card company to alert them that you were a victim of fraud. However, keep in mind that they often want a police report before they’ll take any action.

    If you decide to hire an attorney, provide all your information to her, keeping copies for yourself.

    Reporting to Local Law Enforcement

    As soon as possible after you suspect fraudulent activity, contact your local police department and ask to file a police report. In most cases, you shouldn’t call 911. Call the police non-emergency number or visit the police station in person unless you actually feel as though your life or physical well-being is threatened.

    Sometimes local law enforcement will be reluctant to create a report if the incident wasn’t local. Insist that the officer create a written report for you, as you may need it when dealing with other agencies or companies. For example, if the incident involved funds from your bank account, your bank may want a copy of the police report.

    In the event the scam artist you encountered was local, a police officer may want to follow up with you to get more information as your report is investigated. If a suspect is arrested, you may also be called to identify the person or to talk to a prosecutor about your experience.

    Reporting to Your State Attorney General

    Each state attorney general’s office has a consumer protection division that takes reports of fraud and scam artists. Typically you can file a complaint online, but you may want to go to a local office if you have documents you want them to review. You can also mail a complaint along with copies of relevant documents.

    Follow your outline and notes to file the complaint, giving them as many details as possible so they can investigate the matter. You may receive a phone call from a state attorney asking for more information. Make sure you include contact information with your complaint so staff can reach you if they have any questions or need additional details about the incident.

    Reporting to the Federal Government

    You can also report scam artists and fraudulent activity to the federal government. The FBI runs the Internet Crime Complaint Center, where you can file an online report that will be investigated by the FBI or forwarded to the relevant federal agency. This website only deals with incidents that occurred online. However, other federal agencies take reports dealing with other incidents of fraud.

    The FTC takes complaints dealing with scams and fraud generally and will forward your complaint to the relevant agency if it doesn’t fall within the scope of matters that agency typically investigates. If you can’t figure out which agency to submit your report to, you can start there.

    If the fraudulent activity involved anything being mailed, you can report the activity to the U.S. Postal Service. If you dealt with someone pretending to be a tax collector, report him to the IRS. You can report Medicare or Social Security fraud to those agencies directly.

    Protecting Your Accounts and Records

    After a brush with fraud, you’ll understandably be paranoid and uneasy. You may find yourself reluctant to do things you normally had no problem doing. Take proactive steps to protect your hard-earned money and your identity from theft and fraud. Change all your passwords to different things for every website, and change your home Wi-Fi password.

    If you receive an email or phone call from someone claiming to be a government employee, bill collector, bank representative or the like, don’t give the person any personal information until you can verify that he is who he says he is. The easiest way to do this is to directly contact the agency or company he claims to represent. Call the customer service line and explain you’ve been contacted by someone who claims to work there. If it is a fraud, they’ll help you shut it down.

    If any of your credit cards or bank accounts were compromised as a result of your brush with the scam artist, have the card cancelled immediately and a new one sent. If she got personal information from you, such as your Social Security number, you might also consider putting a fraud alert on your credit report so she can’t open any new accounts in your name. All of this can take some time and effort, but the more secure your information is, the less likely you will become a victim again.

    Report fraud and scam artists to local law enforcement, your state attorney general and the FBI. If the fraudulent activity occurred on the internet, you can file a complaint with the FBI’s Internet Crime Complaint Center.

    How to Find Out Who Is Using My SSN?

    Related Articles

    • How to Find Out Who Is Using My SSN?
    • How to Report Fraud & Scam Artists
    • How to Report Scams to the Police
    • How to Press Charges for Identity Theft

    Reporting fraud, from embezzlement to identity theft, is important for two reasons: it can help you as a victim recover personal losses, and it can prevent other people from falling victim to the same scheme. Sometimes, whether because of the high volume of fraud reports or because your local police force is ill-equipped to deal with such cases, filing a fraud report with local authorities can be difficult. Still, you should always report a crime, including fraud, to the local police, as a police report will help protect you in the future. If you’re the victim of a fraud, close your affected bank accounts and credit cards, file a report with the Federal Trade Commission (FTC), place an alert on your credit report and begin the process of filing a police report with your local law enforcement agency.

    First Report to the FTC

    The first step after you lock down your accounts and credit is to file a complaint with the Federal Trade Commission online at ftc.gov. Fill out the FTC ID Theft Complaint form, which will grant you some protection against fraudulent information on your accounts and credit report. The FTC will provide you with guidance as to how you can stem the negative effects of the fraud and what steps you should take next. The FTC recommends filing a police report.

    Filing a Police Report for Fraud

    After reporting the matter to the FTC, call your local police and tell them you’d like to file a fraud report. Ask them if it’s possible to do so in person at the station. If not, ask how you can file by phone or online and take notes on their instructions. If you go into the station to file, bring a copy of your FTC report and any supporting documentation, such as your bank statements or correspondence you may have received from the thief or companies the thief has dealt with. Fill out the forms given to you by the police and ask them to attach the copy of the FTC report to your police report.

    Ask for a copy of your police report. Hold on to your report as proof of fraudulent activity on your accounts and credit report. If the police cannot offer you a copy of the police report, as is the case in some jurisdictions, have the officer sign your FTC complaint form and list the police report number in the “Law Enforcement Report” portion of the complaint form.

    If your local police are unwilling to take a fraud report, try filling out a Miscellaneous Incident report. Then contact your state’s attorney general to see if your state requires local police to take fraud reports. Your state’s attorney general may also have a special task force to combat fraud, and his office may be able to refer you to another jurisdiction, such as the state police, to file your report.

    Jurisdiction for Internet-Based Fraud

    For fraud conducted via the internet, including scams delivered by spam and phishing websites, and your local police may not be able to take your report if you don’t know where the scam occurred. For example, if someone steals your identity and opens up a credit card in another state, you’d have to contact the police in that state; on the other hand, if everything was done online and you don’t know where the scammer is located, police jurisdiction might be harder to determine. Contacting the FTC is the first step in this situation.

    What to Do Next

    Keep copies of all reports you file, both with the police and with the FTC, as they may be needed again to combat new or reappearing fraudulent charges. You may want to provide copies to the credit reporting bureaus as part of your fraud alert file.

    If you’ve experienced fraud, your first step is to protect your finances by putting a fraud alert on your credit report and freezing or closing your bank accounts and credit cards. You can freeze your account by contacting your bank. To place a fraud alert on your credit report, contact one of the three credit reporting companies – Experian, TransUnion or Equifax. After you’ve secured your accounts and credit, report the fraud to the Federal Trade Commission, then file a police report.

    Charitable organizations are governed by the Solicitation of Charitable Funds Act found in S.C. Code of Laws Title 33, Chapter 56. All charitable organizations that solicit contributions or have contributions solicited on their behalf must register with the Secretary of State’s Office prior to any solicitation activity and on an annual basis unless they fall under one of the statutory exemptions from registration.

    A charitable organization that is required to register with the Secretary of State’s Office must submit a Registration Statement for a Charitable Organization (PDF) each year. In addition, a charitable organization must submit the Secretary of State’s Annual Financial Report Form (PDF) or the IRS Form 990, 990-EZ or 990-PF each year. Charities can file registrations and financial reports online. Start the online filing process.

    • For entities that are not required to file with the Secretary of State, see S.C. Code of Laws §33-56-20.
    • For entities that are exempt from registration with the Secretary of State, see S.C. Code of Laws §33-56-50. An entity that is exempt from registration must file an Application for Exemption (PDF) with the Secretary of State on an annual basis. If at any time the charitable organization no longer qualifies for an exemption, it must immediately register as a charitable organization.

    Non-compliance with the Solicitation of Charitable Funds Act, including but not limited to failure to submit a registration, registration exemption, or financial report when due, will result in the assessment of administrative fines. The Secretary of State may, upon his own motion or the complaint of any person, investigate a charitable organization.

    South Carolinians from all income levels respond quickly and generously when they see a true need. Check out our Wise Charitable Giving Brochure (PDF) to learn how you can donate with confidence. For additional guidance on social media fundraising campaigns, please check out our Crowdfunding and Online Giving Brochure (PDF). For additional information on crowdfunding, please see the Online Giving Donor & Consumer Guide (PDF) published by the National Association of Secretaries of State, National Association of Attorneys General, and National Association of State Charity Officials.

    If you would like to file a complaint concerning a charitable solicitation, please complete the Online Charitable Solicitation Complaint Form.

    • How to report nonprofit fraud

    The Credit Fraud Problem

    It goes without saying that credit card fraud in this day and age is a significant problem. With the numerous breaches (Target, Equifax and Capital One, to name a few) that have occurred recently, it comes as no surprise that this type of fraud is occurring more frequently these days. According to Market Watch, The Nilson Report estimates credit card fraud to exceed $35 billion in 2020.

    But did you know that one type of credit card fraud, card testing, is seeing exponential growth and often targets nonprofit organizations? That’s right. When fraudsters get their hands on stolen credit cards they have to test them to determine which ones have not been reported as stolen and therefore can be exploited. They test them by making small transactions on unsuspecting e-commerce sites. One of their favorite places to test these stolen cards is on donation pages found on a nonprofit’s website.

    Why are Nonprofits a Target?

    There are a number of reasons why nonprofit donation pages are a common target for card testing.

    • Nonprofits commonly offer simple donation pages – Because nonprofits want to offer a quick and easy way for donors to contribute to support their organization, they often offer an easy donation solution. These simple donation pages collect a minimal amount of information and typically have no mimimum limits for giving. Unfortunately, this simplicity makes it easy for fraudsters to automate card testing to test numerous cards over a short amount of time.
    • Card consumers often won’t flag a donation – Fraudsters keep each card test small – usually less than $10 – so as not to raise any red flags. But even when consumers discover a small charge to a charity or nonprofit, they are less likely to report the activity or challenge the charge.
    • Nonprofits might not be following best-practices – Nonprofits are more likely to offer a simple donation solution without taking the proper steps to protect themselves (and their donors) from the risk of credit card fraud. This can be a result of utilizing a less than secure, but cheap, donation solution on their website or not turning on security verifications through their payment gateway to limit successful fraudulent transactions.

    What is at Risk for Your Nonprofit?

    So what exactly is at risk if your nonprofit doesn’t take steps to minimize fraudulent card testing?

    • Lost staff time – Reviewing hundreds of attempted charges associated with a card testing event takes significant time. The investigation will likely involve your IT staff reviewing logs and transaction records before they can explain what happened. In addition, any successful fraudulent charges must be found so a refund can be issued through your payment gateway provider. This will require hours of time and expense.
    • Lost transaction and chargeback fees – Refunding successful fraudulent charges will return the money to the rightful cardholders, but the transaction fees are non-refundable and are therefore a loss for the nonprofit. In addition, some vendors will assess a chargeback fee for each fraudulent transaction to the nonprofit. These are typically between $10 and $25 per transaction.
    • Damaged credibility – Perhaps the worst damage is what these events do to your organization’s credibility. When an unsuspecting cardholder has their credit card compromised and it started with a card test on your nonprofit’s website, they might not be very forgiving. With plenty of platforms to share their story through social media and/or review sites, they might be tempted to share their story and sully your organization’s reputation in the process.

    What Can You Do to Minimize Your Nonprofit’s Risk to Card Testing?

    Unfortunately, there is no definitive way to prevent your nonprofit’s donation page from being used for card testing. However, if you take the following steps you can minimize the likelihood that your site will be targeted by fraudsters or at least minimize the impact that such an event will have on your organization.

    • Form obfuscation – It’s a big word, but a simple concept. Form obfuscation is a tactic to obscure or hide forms to make it more difficult for bots to find and exploit them. Form obfuscation is critical on your giving forms, but it is a good practice to have form obfuscation in place for any form that collects sensitive information (i.e., personal identifiable information, credit card information, etc.).
    • Use a CAPTCHA – A CAPTCHA is a system or method used to distinguish human from machine input. Using a quality CAPTCHA on your donation form will help to ensure that a human-being is behind each donation form submission.
    • Require CVV/CVC verification – A card verification value/code is that 3 or 4 digit number on the back of your credit card. Check with your payment gateway to make sure that a donation transaction is not allowed through unless the CVC associated with the credit card has been verified. This is usually a setting you can verify/change directly on your payment gateway’s dashboard.
    • Require address verification – Another useful requirement is address verification. When this is required by your payment gateway, the numeric portion of the cardholder’s address and/or their postal code is verified before the transaction is approved. This verification often trips up card testers who don’t have this information.
    • Require a minimum donation – Setting a minimum donation amount of $15 will deter many card testers, since they typically test cards with very small transactions to avoid being noticed. This obviously means that legitimate donors who would like to make a small contribution to your organization will also have to follow this requirement. One distinction that can be made is to only require this minimum amount for one-time donations, allowing for smaller recurring donations.

    Credit card fraud targeting nonprofits is a significant, growing problem. Being proactive and following these simple guidelines will help to protect your nonprofit from this type of abuse.

    To learn more about what you can do to protect your nonprofit from this type of fraud or inquire about a security audit for your website, contact the experts at The A Group.

    This page explains which government departments look into different types of complaints against nonprofits, and how to avoid problems. Whether you are the director, a member, or a potential donor of an Ontario nonprofit this information could be helpful to you.

    If you believe a nonprofit is misusing charitable property, then you can contact the Office of the Public Guardian and Trustee.

    If you believe a nonprofit is breaking tax laws, for example, by hiding business revenue, then you can contact the Canada Revenue Agency (CRA) through its Informant Leads Program.

    This might include situations like:

    • The directors aren’t holding meetings of members when they should.
    • The directors weren’t elected according to the required procedure.
    • The directors are refusing to step down when their term is over.
    • Members aren’t being allowed to see financial statements.
    • Someone is taking actions that aren’t allowed under the by-laws.

    The Office of the Public Guardian and Trustee recommends that you first check whether your nonprofit’s bylaws or constitution set out steps you can take in the situation.

    If your bylaws do not say what must be done in such a situation, you can remove a director with a simple majority vote. This means that more than half of your members who vote at a general or special members meeting agree to remove a director.

    But if your bylaws, before November 14, 2017 said you need a two-thirds majority vote to remove a director, then you have to follow them until you change your bylaws.

    Whatever your bylaws say, you always have to tell your members when you give them notice of the meeting that they will be voting to remove a director. If you do not, the vote may not be valid.

    If you have tried those steps and it didn’t help, you may need to speak to a lawyer.

    Registered charities
    The FAQ “How can I complain about a Canadian charity?” explains the steps you can take to complain about a charity. (Scroll down to the 9th question)

    Managing issues correctly from the beginning can help you avoid complaints and problems later. Here’s a Top Ten Tips list to help prevent legal risk, and a checklist to go with it.

    For a step-by-step approach on how to deal with a difficult director, see the article That director is such a pain: how do we get rid of him? (scroll down to p.5).

    Note: This article is helpful, but one part of it is out of date. The article says that members can remove a director only if two-thirds of members who vote, agree to it. This is still true in some cases, but it only applies if your bylaws say that. If your bylaws don’t say anything, you only need more than half of the members who vote to agree to it.

    This guide offers helpful tips on how to handle a Canada Revenue Agency (CRA) audit.