Is Crowdfunding Legit?

Crowdfunding Legit

Crowdfunding is an online system for raising money from a large number of people for a project. This can be used for a number of different purposes, including business fundraising, personal or familial fundraising, disaster relief and development of a product. However, crowdfunding is often abused by fraudsters. There are steps you can take to help keep yourself safe and avoid falling victim to a scam.

The first thing you should do is make sure that the crowdfunding websites campaign is legitimate. A good place to start is with the organiser’s contact information. If the organiser does not seem trustworthy, look for another source. You can also use your Facebook and Twitter accounts to check the legitimacy of the crowdfunding campaign.

It is also important to know the rules of the site. Many crowdfunding sites have their own rules and you should familiarize yourself with them. For example, Indiegogo is not authorized to broker investments on their platform. So, if you find a non-accredited lender asking for funds on a crowdfunding site, it is likely a fraud.

Is Crowdfunding Legit?

Another way to determine the legitimacy of a crowdfunding campaign is to find out who is funding the project. Often, crowdfunding projects are run by nonprofit organizations. Check to see if the organiser has a verified charity or nonprofit organization. Some crowdfunding sites allow you to report an unknown organiser if you suspect a scam.

In the case of a crowdfunding websites scam, the person behind the campaign will prey on your empathy and your desire to help others. They will often have no intention of following through with their promises. Once you have donated, you may not even get a product or invention. That’s why it is so important to do your research and be wary of brokers.

Scammers often try to use cutting-edge technologies to lure their victims. One crowdfunding campaign, for instance, posed as an effort to save a high-rise condo in Surfside, Florida. But, the CEO of the company allegedly stole a large percentage of the funds for his own personal benefit.

Another scam, called the “iBackPack” scam, promised that a backpack containing built-in batteries would be delivered to the victim. The scam was exposed after the iBackPack website went down. According to the FTC, the iBackPack CEO allegedly took the majority of the funds and ran the company with a profit.

There are several other types of crowdfunding scams. For example, some sites offer to pay you with bitcoin. However, many of these websites are fake, so make sure to check the legitimacy of the site. Similarly, fraudsters can easily use your social media account to create photos that don’t match the crowdfunding campaign.

To keep yourself safe, do your research, monitor your social media activity and give directly to local organizations. Also, talk to people in person. These methods are a good alternative to crowdfunding. By giving locally, you are more likely to connect with the person who is doing the fund raising.