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Charitable Donation Refund Scam

Charities and credit card users should be alert for the following scam:

A charity receives a credit card donation of $5,000 from a person claiming to be a new donor. (The amount varies, but typically it’s several thousand dollars.) Shortly thereafter, the alleged donor emails the charity and explains that there was a mistake: the gift was supposed to be $500, not $5,000; and the credit card that was used was recently closed because of fraud, so kindly refund the $4,500 to a different credit card.  The "donor" also frequently claims to have recently lost his or her spouse, thus increasing the drama. And if the charity responds that it can only refund to the original card, the "donor" often escalates his or her tone - or even makes threats - in an attempt to scare the charity into making an immediate refund.

This scam has been occurring since at least 2012. Most likely, the scammer makes the donation with a stolen credit card. “Donating” the money to the charity allows the thief to obtain a large sum from the stolen card before the card can be closed. This also allows the scammer to launder the funds for future use. 

What to Do

Victims of the above scam should report the matter to their credit-card processing company and to the Internet Crime Complaint Center (IC3).   The IC3 was established as a partnership between the FBI and the National White Collar Crime Center, and serves as a vehicle for receiving, developing, and referring criminal complaints of cybercrime.

Victims may also file a complaint with the Attorney General’s Consumer Protection Division at:

Consumer Protection Division
P.O. Box 30213
Lansing, MI 48909-7713
Online complaint form

* For actual examples of this scam, see Robert L. Weiner Consulting's website.