Go Fund Me: Crowdsourcing On The Local Level


Over the past five years, more than 18,000 GoFundMe users in the New York City area have raised more than $4 million from more than 54,000 donors. That’s a lot of generous gifting happening and that is just in our small corner of the world. Anton Media Group wanted to know more about this growing trend in crowdfunding, so we contacted GoFundMe to get an idea of what’s going on with this phenomenon, who’s using it and why.

“With more than $700 million raised by more than eight million donors [worldwide], GoFundMe has quickly become the world’s most popular crowdfunding site,” said Kelsea, a customer service manager at GoFundMe. “GoFundMe provides a platform for people to raise money for the things that matter to them most—inviting the support of family and friends is a natural response.”

People from all over the world are asking for money and receiving it through crowdfunding sites like GoFundMe and KickStarter.

“Anyone on GoFundMe can raise money for just about anything, so long as they are not breaking the law and are in accordance with our terms and conditions [listed on the website],” Kelsea at GoFundMe said. “Most all giving on GoFundMe occurs between family and friends, and so in order to raise donations, campaign organizers must have a personal network of people interested in donating to their cause.”

Friends of David Pagano in East Meadow have created a GoFundMe campaign to help their friend who has been diagnosed with melanoma. Check out www.gofundme.com/ qs476e4 to help lessen the medical expenses for Pagano and his family.
Friends of David Pagano in East Meadow have created a GoFundMe campaign to help their friend who has been diagnosed with melanoma. Check out www.gofundme.com/
qs476e4 to help lessen the medical expenses for Pagano and his family.

GoFundMe confirms that it and its payment processors “have many systems in place to catch and deter fraudulent activity.” But users are encouraged to report suspicious activity and campaigns for investigation.

“In the rare event that we do find fraudulent activity on an account, we have the power to remove the account, refund donors and ban the user from ever signing up again,” said Kelsea. “With millions of campaigns, it’s not feasible for GoFundMe to investigate the claims stated by each campaign organizer. Rather, we provide visitors with the tools to make an informed decision as to who they choose to support.” GoFundMe reminds donors on every campaign page, “Only donate to people you personally know and trust.”

Donations on crowdfunding sites are not taxable; they are simply considered “personal gifts” and therefore not taxable in the U.S. Fund recipients do not have to report the money as income, according to GoFundMe. And while it is usually free to create and share a crowdfunding solicitation, sites like GoFundMe deduct 5 percent from each donation received.

GoFundMe campaigns, like most crowdfunding solicitations, do not have time limits, allowing organizers to raise money for as long as they like. (Click on the following communities to find out about GoFundMe projects going on in Garden City, Massapequa, Mineola and Syosset.)

Funding Etiquette?

“Funding new business ventures is one of the things that originally sparked this idea of crowdfunding; many of the requests and uses were totally appropriate,” said Lizzie Post of the Emily Post Institute told Anton Media Group. “The cause should be great, legit, genuine and coming from a good place, not potentially self-indulgent or for personal gain.”

Post, a great-great-granddaughter of the late Emily Post, synonymous with etiquette and good manners, said poor judgment would be asking for crowdfunding for a new sports car or a bigger engagement ring.

“It’s unethical for you to ask a friend to set up a crowdfunding request for frivolous things,” she said. “It is acceptable however to have friends pull together to want to help someone in true need, helping to give you something you deserve, like after an emergency or personal tragedy.”

Post said donors should also use some judgment. Know what is appropriate to give money toward. Know who you are giving money to. Know who is benefiting from your money and understand why you want to give money to a cause.

Thomas Kenna of Floral Park is raising money to help fund his educational Model UN trip to China and India. Kenna was one of 24 students selected to participate and is working to raise $8,000 to cover the expenses. Check out www.gofundme.com/kennamodelun to learn more about his campaign.
Thomas Kenna of Floral Park is raising money to help fund his educational Model UN trip to China and India. Kenna was one of 24 students selected to participate and is working to raise $8,000 to cover the expenses. Check out Kenna Model UN on Go Fund Me to learn more about his campaign.

“Americans do have a decent judgment meter,” Post said. “Most people immediately think ‘that’s a bit much’ when they see something that is completely outrageous or in poor taste.”

According to Forbes, there has been a 50 percent increase in crowdfunding in just the last few years, and the average crowdfunding donation in 2013 was $88. As consumers utilize this new platform for giving, there are important tips that can be followed to be informed and to stay safe.

“As more charitable giving moves online and to crowdfunding websites, there is an opportunity for users to harness innovation to achieve worthy goals,” said Attorney General Eric Schneiderman. “It is also important that New Yorkers follow some basic tips to stay safe and to understand how their contributions are being used.”

Crowdfunding is growing for both charitable and non-charitable giving that has eliminated barriers for both donors and those seeking donations. While most donors in New York State still use traditional methods for their charitable giving, the rapid growth in crowdfunding is changing how people think about giving and allows for direct peer-to-peer donating that differs from giving contributions to organizations.

The attorney general’s office has recently released some of its own tips for funders:

• Use well-established websites with a known track record. Some crowdfunding websites vet projects and others do not. You should understand what the website requires from a campaign before it is posted.

• Know what you are getting for your contribution. In some cases your contribution will be a donation, and in others it may entitle you to a product or a share of a company.

• Know what protections the crowdfunding platform provides. In most cases, the platform will not reimburse you if a campaign fails to deliver what it promised.

• Be aware that many of the laws regulating charities do not apply to many postings on crowdfunding sites. Your first line of defense when donating is to check the terms and conditions of crowdfunding websites.

• Understand if there are any fees associated with each contribution and whether a crowdfunding website is retaining a portion of your contribution.

• Don’t give out sensitive personal information such as a Social Security number or password to anyone who solicits a contribution from you. When donating online, make sure the website is secure and includes ‘https’ in the web address. Donating with a credit card provides more protection than a check while still offering a paper trail documenting the transaction.

Thoroughly research the project before contributing:

• Be wary of campaigns with few details. Credible projects will have established web and social media presence, and offer regular updates.

• Check the campaign creator’s social media accounts to confirm identities and real-world connections.

• Many crowdfunding platforms will let you write to a project’s creator. Ask questions and review how the creator has responded to others.

• Compare details with other campaigns for similar products. If it seems too good to be true, it usually is.

What to do if you believe you have been scammed:

If you believe you are the victim of a scam, file a complaint with attorney general’s office by calling the consumer helpline at 800-771-7755, emailing the charities bureau at charities.bureau@ag.ny.gov or filing a complaint at www.ag.ny.gov.

Christy Hinko
Christy Hinko is a managing editor at Anton Media Group. She is a New York Press Association (NYPA) and Press Club of Long Island (PCLI) award-winning writer and photographer.

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