How well do you know your donor?

When a charity receives a legacy confirmation, there is often a sense of relief, gratitude, and, let’s be honest, excitement. After all, someone has chosen to include your organization in one of the most personal decisions they will ever make.

But that moment should also trigger something else: a clear, proportionate Know Your Donor due diligence process.

Particularly when the charity is notified that a donor has left a gift in their will and there has been little or no prior relationship, the risks are not hypothetical. They are real. And they are often underestimated.

Too many organizations still treat a legacy confirmation as automatically “safe” because the gift is testamentary, future-facing, or wrapped in the emotional language of donor generosity. That’s understandable but it’s also risky.

A Know Your Donor approach exists to protect the charity, its mission, its staff, its trustees, and, frankly, the integrity of current and future donor relationships. The purpose is not to be suspicious of every donor. It is to be professionally curious, appropriately cautious, and consistent in how the organization accepts philanthropic support. The process involves the need for charities to establish the donor’s identity, understand the purpose of the gift, assess whether the donation is appropriate for the cause, and screen for suspicious, unusual, or unreasonable activity.

So what risks might a legacy gift expose a charity to?

The obvious one is reputational risk. If a legacy comes from a donor whose public conduct, business activities, affiliations, or source of wealth raise serious concerns, the charity may find itself associated with behaviour that conflicts with its values.

For instance, a charity I know that works in the area of climate justice accepted a legacy from a donor who set up a trust whose funds come from mining exploration. It’s a head scratcher, isn’t it?! 🤔

There is also regulatory and legal risk, particularly where questions arise around sanctions, criminal activity, fraud, politically exposed persons, or the source of funds or assets. Then there is operational risk. Some gifts arrive with conditions, expectations, or restrictions that are impractical, unreasonable, or out of line with the charity’s mission. Others may require expenditure, oversight, or responsibilities the organisation had not anticipated. A legacy is not always a simple cheque in the post. It may involve property, shares, contested estates, complex family dynamics, or instructions that create more burden than benefit. A formal due diligence framework asks whether conditions are reasonable and achievable, whether the donor gains any benefit beyond tax treatment, and whether the gift could affect the charity’s integrity, independence, or freedom to operate.

And then there is relational risk, which legacy teams do not talk about enough. If a charity handles these moments clumsily, it can damage trust with executors, family members, legal representatives, and existing supporters. Due diligence must not feel accusatory or transactional. It should feel like what it is: good governance carried out with professionalism and care.

Let’s bust a few myths …

• Myth one: “We only need due diligence for major cash gifts made during a lifetime.”

No. A future gift can carry just as much reputational and legal risk as a current one, sometimes more. In some cases, you have less information, not more, therein lies the importance of a due diligence process.

• Myth two: “If the donor is deceased, the risk has passed.”

Not remotely. Reputational fallout, contested assets, problematic conditions, and public scrutiny do not disappear because the donor is no longer living.

• Myth three: “Due diligence will offend the donor’s family or executor.”

Not if handled properly. Most professional executors, advisors, and family representatives understand that charities have governance obligations. Calm, proportionate processes build confidence.

• Myth four: “This only matters for very large legacies.”

Size matters, but it is not the only indicator of risk. Setting a financial threshold is sensible as it allows gifts to be escalated based on concern, unusual patterns, or cumulative activity rather than value alone. That is exactly the right instinct.

So how do you integrate Know Your Donor into donor engagement without turning your stewardship process into a compliance seminar nobody asked for?

Start simple.

First, create a clear internal trigger. A legacy confirmation, a notice of inclusion in a will, or contact from a solicitor or executor where there is no existing donor relationship should automatically prompt a basic review. It doesn’t have to be overly complicated, just a standard step in the process of recording the call in the database.

Second, define levels of review. Not every case needs the same intensity. A proportionate model works best: basic identity and background checks for lower-risk situations, then enhanced review where there are red flags, unusual assets, complex conditions, high values, or public concerns.

Third, connect due diligence to stewardship, not separate it from it. Legacy teams should know what information needs to be gathered, who reviews it, when a case is escalated, and how to communicate with sensitivity. This is not just a finance or legal issue. It sits at the intersection of fundraising, governance, and donor experience.

Fourth, document your decision-making. If a gift is accepted, restricted, escalated, or declined, record why and save all documents collected to arrive at that conclusion. Good governance is not simply making the right decision. It is being able to show how the decision was made.

Finally, train your people. One of the biggest risks in legacy fundraising is inconsistency. One fundraiser feels uncomfortable asking questions. Another assumes the gift is harmless. A third escalates everything out of fear. None of that is strategy. A simple policy, a practical checklist, and clear roles go a long way.

The point here is not to make legacy fundraising colder or more suspicious. Quite the opposite. It is to make it more professional.

Because a charity that introduces Know Your Donor due diligence at the point of legacy confirmation is not distrusting generosity. It is respecting the seriousness of stewardship.

And in a sector that rightly talks so much about donor trust, that matters.

At the end of the day …

Legacy gifts deserve warmth, gratitude, and thoughtful stewardship. They also deserve sound governance.

When a charity receives confirmation of a gift in a will, especially from someone it barely knows, that is precisely the moment to pause and ask a few careful questions. Who is this donor? What is the nature of the gift? Are there any concerns, conditions, or reputational issues we need to understand before proceeding?

That is not cynicism. That is responsible fundraising.

If we want legacy fundraising to be seen as mature, strategic, and trustworthy, we need to stop treating due diligence as something reserved for obvious problem cases. It should be a normal part of the donor journey. Quietly competent. Proportionate. Human.

Because sometimes the most donor-centred thing a charity can do is not rush to bank the gift, but take the time to handle it properly.