Crowdfunding website offers ‘donation back guarantee’ in case of fraud

This article is more than 12 months old

Crowdfunding website, Ray of Hope Initiative, said from Oct 1 this year, it will return donations in full if any of its fund-raisers turns out to be fraudulent.

It is the first crowdfunding website in Singapore to offer a "donation back guarantee".

Since it started six years ago, the website has handled more than 170 fund-raisers, drawing at least $350,000 for the beneficiaries.

In that time, it has not had a single case of fraud because of the three-step verification process it applies.

It includes visits to the home of the person it is raising funds for and checking documents such as the individual's bank accounts, pay slips and medical records.

It will also verify with the Ministry of Social and Family Development if the person is receiving any government financial aid, among other checks.

Ray of Hope Initiative director Tan En said the promise to return donations is to dispel any concerns that donors may have about being duped.


"We need to give donors the confidence that they are giving to people who genuinely need help and depend on crowdfunding to tide them over a difficult period," he added.

"We cannot afford to penalise those in need due to fraudsters who prey on the kindness and compassion of those who want to help. Any decline in giving affects the people who need help the most."

The move comes after the Commissioner of Charities launched a campaign last Friday to get donors to do more checks before giving.

With the growing popularity of crowdfunding and online fund-raising, there have been several cases of fraud.

In January, to boost transparency and accountability in online giving, it launched the Code of Practice for Online Charitable Fund-raising.

Crowdfunding sites that adopt the code have to assess the appeal's legitimacy, give regular updates on the funds raised and make public the fees they charge.

Those raising funds have to give accurate information to donors, keep proper records of donations received, and use the money for their intended purposes.

The Ray of Hope Initiative has adopted the code.