Unless they are in a legitimate emergency situation, they are defrauding charity. Unfortunately, this doesn't stop everyone, but if they are caught, they would lose all of the money they donated. If I were the one committing fraud, this would seem very risky to me.

Fraudulent claims usually have different characteristics than non-fraudulent claims. If someone claims the full amount they're entitled to on a large sum of money, the fund should investigate that claim before giving the money.

A crowdfunding network is functionally very similar to what I alluded to in my last question:

Can the emergency fund be registered as a charity? What changes would make its charity status unambiguous? For example, should the fund also provide recoupments to effective altruists who did not donate through the fund but donated directly to e.g. GiveWell, but scrutinize those recoupments more?

In a crowdfunding network, the crowdfunders decide for themselves if they consider the situation to be an emergency. In my version, a centralized fund would be the judge. I think the main advantage of my version is that people immediately know which door to knock on if they're in trouble.