I've found some "socially responsible" funds that I'm interested in investing in. I have no idea how to tell if they're a scam though. Is there an accreditation agency or something similar which can verify both their ethical commitments and their financial ones?
Social Funds I find a bit difficult to navigate, but you can sort their list by social issues to see what kind of screening the fund uses (positive, restricted, exclusion, none). Their fund detail page is basically an excerpt from the prospectus - here is their page on the Parnassus Fund, for example.
US SIF has a similar option to view (but not sort) funds by social issue and type of screening. Their fund detail page includes a methodology section which explains how the fund evaluates its profile choices. As an example, here you can see that the Pax World International fund applies financial criteria before social screening, and uses both internal and third party research for screening purposes. As far as I can tell, this is taken almost verbatim from the fund prospectus, but it's nice to have it separated out and easily accessible.
Both of these aggregators link to the fund operators' sites, where you can usually find the prospectus and quarterly holdings. (Note that SocialFunds is identifying itself as the refer-er in those links.) If your question is simply, "do they really not invest in oil companies?", then the list of holdings will definitely answer it. Otherwise, for funds that use third party screeners, you can get more detailed information about ESG practices of individual companies straight from the screeners, though it probably won't be free.
I second mbhunter's recommendation to read the fund prospectus and examine its holdings. For me, the prospectus and holdings, a listing on US SIF, and buying from a reputable firm have been enough to answer any doubts. I don't have time to do exhaustive personal research - that's what the third-party screeners are for - so I trust the claims in the prospectus, which, as mbhunter said, IS a regulated legal document.
The fund's rules should be spelled out, just like for any other fund. I'd read the prospectus of each fund that interests you. These are legal documents required by the SEC that, among other things, define what the fund can hold and what kinds of activities or industries the fund will (or will not) engage in, and how. There are penalties if the mutual fund doesn't follow its own rules.
Basically, the fund is as ethical as it says it is, and part of the auditing process is evaluating how well it follows its own ethics.
It depends on where you found them. The two ultimate sources are Morningstar and ETFdb.com for screening funds.
The following funds listed are not scam: http://etfdb.com/type/investment-style/socially-responsible/
Socially Responsible ETFs invest in companies that have a track record for being socially responsible. Typical companies targeted within these funds are alternative energy firms and organic food makers.
I believe it is more questionable if the "organic food farm" is really organic rather than the ETF is following all regulatory rules thus cant be labbeled as scam.