Check-Writing Scam Targets Charities

February 2, 2016       Andy Segedin      

A check-writing scam targeting nonprofits in the Richmond, Va., area has the Better Business Bureau Wise Giving Alliance (BBB WGA) warning to be on the alert for big checks followed by emails seeking refunds.

Some 18 organizations in the Richmond area recently reported receiving emails from “Ken McFarlane” or “Kenneth McFarlane” with offers of a five-figure donation. The name and contact information mirrors those of an architectural firm in the United Kingdom. Three of the charities received and deposited $39,850 in checks. “McFarlane” soon reached back out to the charities claiming that a mistake had been made and asked that $10,000 be sent back. The checks turned out to be fraudulent.

The charities reportedly did not follow through with the request, but faced bank fees associated with depositing fraudulent checks.

The scam is an old one, said Bennett Weiner, chief operating officer for BBB WGA, typically targeted at businesses. A scammer would place a large order with a business, claim there was a mistake and that the order was too big and ask for money to be sent back. The scams are typically executed quickly and pervasively, with the name and some details changed as to avoid detection. “The scam is an old con just with a new audience,” Weiner said.

Weiner said that if a few charity officials have reported being fooled, it is likely that there are others who are remaining silent. It is important for those executives to come forward, he said, to help spread the word. He warned to be wary of any request for money back, especially given the time it takes to detect whether a check is fraudulent. If a charity’s staff believes that it has been targeted, they are advised to contact the Attorney General’s office of the state the charity is located in for steps to follow.

Thomas Gallagher, president and CEO of the Better Business Bureau serving Central Virginia, said that the scam was first reported late last week and has moved quickly. Through experience, Gallagher does not believe that the scam has been limited to the Richmond area or organizations of any specific type or size. “There is no reason in the world why it would stop here,” he said. “And from the sounds of charities that have come to us, they are all over the spectrum.”

Fundraisers might be tempted to deposit a big check when it comes in, but Gallagher preaches caution and advises against depositing large donations that seemingly came out of the blue. “You don’t get $40,000 unless you’ve developed a relationship,” Gallagher said. “The biggest thing, things don’t happen this way. We don’t get big money coming out of nowhere.”

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