Crowdfunding, Fraudfunding, and Greenwashing

The crowdfunding market remains an instrument in its developmental phase, yet it's witnessing swift growth. Like all novel tools, crowdfunding must prove its capability to fulfill unmet needs within the current market. To establish credibility, it is crucial to curb deceptive practices that undermine the reputation of the tool. This chapter begins with a review of the types of fraud in crowdfunding and then frames greenwashing as a potential category of fraud based on environmental claims within crowdfunding. Indeed, greenwashing refers to the practice of portraying projects as environmentally friendly or sustainable, even when they are not. Such deceptive practices can be considered fraudulent, particularly as backers interested in supporting green initiatives may be misled. Building on original data acquired through a questionnaire submitted to creators of crowdfunding campaigns, this chapter also aims to investigate the perception of the greenwashing phenomenon by upcoming creators and their views on the role of platforms in mitigating the phenomenon. Finally, the conclusions of the chapter focus on several recommendations on how to discourage fraud and greenwashing in crowdfunding.