After the Hurricane, Online Charity Scams Grow in Number and Sophistication

Hurricane Katrina has unleashed a greater number of online con artists circulating bogus charity

appeals than did last year’s tsunamis or the 2001 terrorist attacks, and the scams have become increasingly sophisticated, according to federal officials who investigate such crimes.

“This time it is higher than with the tsunami, which was higher than 9/11. It is a growing problem,” said Paul Bresson, a spokesman for the Department of Justice. The agency has formed the Hurricane Katrina Fraud Task Force, a joint effort with the Federal Bureau of Investigation, Federal Trade Commission, and other federal agencies to stop people who are running improper solicitations and teach donors how to avoid hurricane-related scams.

The FBI has identified more than 4,000 Katrina-related Web sites, many of which the bureau says are fraudulent, and it has logged hundreds of complaints from donors. They are reporting Katrina sites disguised to look like those of reputable charities; e-mail messages containing links to such sites; messages seeking Social Security numbers and other personal information from Katrina donors; and hurricane appeals that trick people into opening files containing computer viruses.

The American Red Cross, which has raised at least $342-million through the Internet, has been the main target of online scams. To fight back, the charity has joined the government’s fraud task force, and a Red Cross information-technology expert is now working with federal officials to enhance Red Cross online security measures, said Teala Brewer, a Red Cross official. The Red Cross has forwarded some 200 questionable appeals using its name to the task force, where federal officials are now reviewing them. So far, eight fraudulent sites have been shut down, Ms. Brewer said.

After the 2001 attacks, Ms. Brewer said, “it was almost like the criminal element was learning how to do this. After the tsunami, they got much better and some of these folks were overseas. They copied our Web site, and you could tell it was a fraud. But with Katrina you have to be sharp to realize it’s not a Red Cross Web site.”

She said that the Red Cross will take legal action to recover donations made in response to scams using its name.

News Reports

Other big charities involved in the Katrina relief effort, such as the Salvation Army, Catholic Charities USA, Habitat for Humanity, and the Humane Society of the United States, reported little or no evidence of fraudulent online or other scams using their names.

Even so, news reports about the scams might cause problems for charities of all kinds, said online-giving experts.

“There have been some misleading pieces of advice,” said Mark Rovner, director of Donordigital, a Washington company that is helping several charities use e-mail to raise money for the Katrina relief operation.

For example, news outlets have advised donors to avoid contributing electronically when the online-giving page’s address, or URL, is different from that of the charity, said Mr. Rovner.

While that is often a sign of a scam, plenty of legitimate charity-donation pages have addresses that don’t resemble the group’s regular Web address, he said. That is because those pages are provided by companies such as Kintera, Groundspring, and others that ensure online donations are made securely, without subjecting donors to identity theft and other problems.

Mr. Rovner said that other anti-fraud tips are just plain wrong. For example, he said, he heard a CNN broadcaster advise viewers to disregard e-mail appeals about the hurricane because no legitimate charity would be asking for money that way. But it is “absolutely routine” for many respected charities such as the Humane Society to send Katrina e-mail appeals to donors who have given in the past and ask them to forward the online appeals to their friends and relatives, Mr. Rovner said.

Such anti-fraud advice may be one reason why some spam filters have recently started classifying messages with the words “Katrina” or “tropical storm” in the subject line as junk mail — a challenge for legitimate charities. But Mr. Rovner says charities are finding ways to deal with that problem.

“All along in online fund raising, we’ve been going two steps forward and one and a half steps back,” said Mr. Rovner. “As this practice has evolved, so has fraud. But the countermeasures have made it more difficult for nonprofits to do their work.”