Schuette: 'Proceed with caution when donating online'

Michigan Attorney General Bill Schuette

LANSING, Mich. – Attorney General Bill Schuette released a consumer alert Monday cautioning donors of crowdfunding online.

Crowdfunding is a way to network and collect money, usually online, to support people or organizations.

"Crowdfunding and other types of internet giving can be tools of tremendous good, but as with any type of giving it can be abused, so it's important to proceed with caution when donating online," said Schuette. "I encourage all Michigan citizens to give --- but give wisely."

Popular sites like IndieGoGo, Kickstarter, and GoFundMe allow users to create their own projects and ask for donations. Social media sites are generally used to spread the word for these projects to bring in more potential donors.

Here are things you should consider when donating:

- Do you know exactly who the donation is going to? Could it be someone else?
- Do you know your donation is going to it's target goal?
- If the donation is to an individual, is it someone you know? Is the person someone that you trust?
- And, does the amount seem reasonable or excessive?

"Michigan Nonprofit Association applauds the Attorney General for taking the lead in protecting Michigan citizens on this emerging national fundraising trend," said Donna Murray-Brown, president and CEO. "Nonprofits that intend to engage in crowdfunding efforts should also be aware of state laws that regulate such activities."

The Charitable Organizations and Solicitations Act regulates charitable organizations and professional fundraisers. The Charitable Trust Section registers these organizations with the enforcement authority of the Attorney General and local prosecutors.

The Attorney General's Charitable Trust Section can be contacted at:

Charitable Trust Section
P.O. Box 30214
Lansing, MI 48909

For more information on crowdfunding, see:

Better Business Bureau's "Crowdfunding for Charitable Causes."