Police spokesperson Jon Neilson has told The Wellingtonian (24 March) that police would investigate complaints from the public about scams, including those targeting potential donors to Christchurch earthquake appeals, if there was sufficient evidence. The Chief executive of the New Zealand Red Cross, John Ware, has been quoted as having evidence that “scammers are trying to take advantage of the public’s generosity at this devastating time”, using online scams and setting up insecure websites that illegally seek to harvest details of potential donors’ credit card and bank accounts and other personal information.

But is it legitimate for any registered charity to lodge formal complaints with enforcement agencies such as the police when evidence comes to light of possible criminal activities? How can such complaints be justified within the humanitarian, philanthropic, public service objectives of a registered charity such as NZ Red Cross or The Salvation Army for example?

Of course it is legitimate and fully justified for any charity to lodge formal complaints when evidence of scams, lack of legal compliance, money-laundering, or any criminal activity comes to light in the course of its own activities. In fact charities have a social responsibility to do so because such scams are “injurious to the public good”. The financial cost of white collar crime alone in New Zealand has been estimated to be about one billion dollars per year, according to the latest KPMG fraud barometer survey. [Read more…]