American Red Cross Committed to Fighting Fraud

Protecting donors’ intent to aid legitimate hurricane victims

WASHINGTON, Thursday, September 29, 2005 — While meeting the unprecedented emergency needs of hurricane survivors, the American Red Cross is committed to being a good steward of the public’s generosity and the donated dollar.

Unfortunately, fraud is a part of life following major disasters, and the relief and recovery efforts for Hurricanes Katrina and Rita are no exception. The Red Cross has a zero-tolerance policy when it comes to fraud and cooperates with local officials to vigorously pursue all such cases. In fact, the Red Cross has already cooperated with the appropriate authorities regarding 261 such cases of alleged fraud.

The Red Cross is rapidly integrating all chapters and service delivery sites into the Client Assistance System, making client information available in a centralized database. Importantly, this network identifies clients who try to register for assistance at multiple Red Cross locations.

Red Cross chapters across the country use uniform guidelines to determine the amount of assistance to be issued based on family size and immediate, emergency-caused needs for necessities such as food, clothing and other essentials. This makes it pointless for people to “shop” for higher levels of assistance from different Red Cross service centers.

Receiving Red Cross assistance under false pretenses – such as repeatedly claiming financial assistance for the same needs – is considered fraud. The Red Cross Office of Investigations, Compliance and Ethics pursue cases of fraud with law enforcement agencies as soon as they are reported.

To coordinate efforts in addressing the fraudulent solicitations and unauthorized fundraising, the Red Cross is working with the U.S. Department of Justice Katrina Fraud Task Force, which includes the Federal Bureau of Investigation, the Secret Service, the U.S. Postal Inspection Service, the Federal Trade Commission and other law enforcement and government entities.

It is a federal felony for anyone to engage in fraud schemes that use the U.S. mail, interstate telephone or wire communications, or credit cards (18 U.S.C. §§1341, 1343, 1029), including schemes to defraud would-be donors to charitable causes. It is also a federal felony for anyone to falsely or fraudulently hold himself or herself out as a member of or an agent for the American Red Cross for the purpose of soliciting or collecting money (18 U.S.C.§ 917). In addition, fraudulent solicitations for supposedly charitable causes may violate other federal or state consumer protection laws. Punishment for these types of felonies can lead to sentences of up to 30 years in prison. The Red Cross pursues these cases to the fullest extent of the criminal or civil law.

The American Red Cross does not send spam emails. Official Red Cross emails are sent only to individuals who have requested our electronic communications or to donors who have previously made a contribution and provided their email address.

All American Red Cross disaster assistance is free, made possible by voluntary donations of time and money from the American people. You can help the victims of this disaster and thousands of other disasters across the country each year by making a financial gift to the American Red Cross Disaster Relief Fund, which enables the Red Cross to provide shelter, food, counseling and other assistance to those in need. Call 1-800-HELP NOW or 1-800-257-7575 (Spanish). Contributions to the Disaster Relief Fund may be sent to your local American Red Cross chapter or to the American Red Cross, P. O. Box 37243, Washington, DC 20013. Internet users can make a secure online contribution by visiting http://www.redcross.org/donate/donate.html.