When people picture a scam, they often think of something that produces no value at all — like a charity that pockets 100% of donations.
However, most successful scams don't actually work like that. Instead, they provide some legitimate services, and use this as cover for the scam.
Take Enron, a multi-billion dollar fraud. For years, Enron provided legitimate energy services to real customers. But these legitimate services did not stop Enron from being a fraud. In fact, they enabled Enron to be a fraud.
No one hands billions of dollars to an operation that is obviously a scam. They hand it to an operation that looks mostly legitimate.
By providing real services to real customers, Enron was able to present itself as a legitimate business, and scam people out of billions of dollars.
The biggest scammers in history have relied on this exact strategy, and the next ones will too.
Just because a charity does some legitimate work doesn't mean they aren't a scam.
A charity can feed hundreds of homeless people, but if most of their marketing claims are lies, the charity is still a scam.
The question is not whether a charity does some real work — it's whether the charity's claims are lies.
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