|English: basketball player (Photo credit: Wikipedia)|
- Scammer finds a company that has a program to match charity contributions, i.e. if you, employee of this company, donate $1000 to an approved charity, the company will match your donation, so the charity will actually get $2000.
- Scammer sets up a fake charity, complete with the IRS certification and all that. It will be very authentic, for a very good cause, and even has celebrity endorsements.
- Scammer gets his fake charity approved as one of the allowed charities for the company.
- Scammer recruits one of the employees as a co-conspirator, with the following proposal: you put in the paperwork that says you donated $1000. I'll give you "receipt" that "proves" you did so. When the company matches your money, I'll split it with you. It's free money! As I do most of the work, you get small cut. However, if you can find me more people that'll do the same, I'll give you a bigger cut. It's free money! Do we have a deal?
So this is what happens...
- Employee submits a fake donation record as certified by this fake charity that says he donated $1000.
- Company matches the supposed donation, and gives $1000 to the fake charity.
- The scammer then splits the $1000 with the employee.
Yep, and this is highly illegal, as it's fraud on multiple levels.
And it's a real case that involved Federal Court, and a fake charity called Hoops4Africa.