(BIVN) – State officials are warning Hawaiʻi nonprofits of a new scam involving fake donation checks. 

The Department of the Attorney General says fraudulent donors are reportedly sending counterfeit checks to nonprofits. Later, the donor requests a portion of the donation be refunded, before the nonprofit discovers that the check is fake. 

Names previously used to make suspected scam donations in Hawaiʻi are “Leonardo Kotlar” and “Give To Help Foundation,” the AG’s office says. 

“These scams are designed to exploit the goodwill of nonprofits and the community they serve,” said Eunice Park, Charities Program Administrator with the AG Department’s Tax and Charities Division. “We urge all nonprofits to stay vigilant, verify all donations before allocating resources and report suspicious activity.” 

From the Department of the Attorney General: 

Similar scams have been reported nationally, which are typically carried out when a scammer reaches out to a nonprofit, posing as a generous donor or a corporate representative with an initial offer of a specific donation amount. The scammer then sends a donation check, which is often larger than the amount initially offered. After the check is received, the scammer contacts the nonprofit, claiming they committed an error and need a portion of the funds back. They may cite urgent circumstances, such as an emergency or other pressing financial needs. When the nonprofit sends the requested refund, the original check is rejected as fraudulent and the nonprofit is left with a financial loss.

The AG says Hawaiʻi nonprofits should take the following precautionary steps for their protection: 

• Verify Donors: Especially from new or unknown donors, verify their identity and the legitimacy of the donation. For example, the reported suspected scam came from a scammer impersonating a nonprofit organization with a .com web address, with no other digital footprints or searchable records from the IRS database.
• Spot Check: Make sure the check was issued by a legitimate bank. While some counterfeit checks will include a legitimate bank’s name, a fake name is a clear red flag. This also applies to a cashier’s check, as it has been reportedly used in an attempted scam in Hawaiʻi.
• Wait for Clearance: Do not refund any part of a donation until the check has fully cleared, as bank processing times can vary and fake checks can take weeks to be discovered. Don’t rely on money from a check unless you know and trust the donor with whom you are dealing.
• Establish Internal Policies: Implement financial controls requiring multiple approvals for any outgoing wire transfers or refund payments. Adopt a policy requiring a check clearance before approving any refunds.

The AG says any questions or complaints about a scam or suspicious donations can be directed to the Department of the Attorney General’s Tax & Charities Division at 808-586-1480 or by sending an email to ATG.Charities@hawaii.gov.