News: Feds Investigating Fraudulent Katrina-Related Web Sites
September 26th, 2005 by Laurie BarakSource: eCommerceTimes
The Federal Bureau of Investigations and other federal law enforcement agencies are investigating allegations of fraud by small charities — or organizations posing as such charities — that arose in the wake of Hurricane Katrina. Online bill payment service PayPal, stepping up its security in response to the concerns over online theft of funds intended for hurricane victims, froze the accounts of a number of charitable projects.
Legitimate — and illegitimate — charities alike were frozen out by the new policy, which arose when reports that thousands of fraudulent Web sites were sprouting up all over the world, seeking to steal money intended to help Katrina victims.
Potential donors are informed on PayPal that they should donate through “eBay Giving Works, the dedicated program for charity listings where you can buy items that support nonprofit organizations.” PayPal also provides links to donate to United Way’s relief efforts on its site.
The FBI is eyeing the new sites, looking for scams. “People who want to make a donation or contribute to a cause should actively seek out reputable organizations and then contact them by telephone,” said FBI spokesman Paul Bresson, based in Washington D.C. “The point is that they initiate the contact on their own.”
The online auctioneer eBay recently halted online auctions of several Katrina-related URLs, like ourtsunami2005.com, which asked that bidding start at $15,000, and which promised that half the funds would go to the American Red Cross.
The reason for the concern is that federal investigators — and credit card investigators too — found that there were nearly 200 fraudulent tsunami-related sites which sprung up after the South East Asian disaster earlier this year.
Fraudsters are also sending phishing e-mail, seeking to dupe unsuspecting individuals into clicking on their fake links. A spokeswoman for the Federal Trade Commission said that the e-mails were even purporting to come from the Red Cross itself.
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