How does receiving free money without paying it back sound? If you’re feeling this is too good to be true, then you’re on the right track.
Government grant scams trick consumers into believing they’ve qualified for a big sum of cash, without having to pay the money back. The Federal Trade Commission says the “free grants” offer to pay for education, bills, home repairs, and other expenses.
So how do con-artists get you on the phone? Some use classified ads in newspapers to advertise the grants. They provide a toll number for consumers to call in and receive information. However, the majority will call you out of the blue and say they are part of an agency that may sound official, but is fake.
According to the FTC, grant scammers will generally use these tactics to make you fall for their scheme:
They will call and congratulate you on becoming eligible to receive the grant. Next, they will ask for your bank account information in order to directly deposit the money. You will also be asked to pay a one-time processing fee
However, the grant money won’t be delivered and the fee you paid will be gone.
BBB offers these tips to avoid falling for this scam:
Don’t share personal bank account information. Scammers will pressure you into sharing this information to get into your pockets. Never give someone sensitive details unless you know who you are dealing with.
Don’t be fooled by the name of fake agency. A caller will make up the name of a government agency to convince you of falling for their scam. Doing a web search could result in finding out if the name of the agency is real or not.
Paying for a free grant doesn’t make sense. If you have to pay a fee in order to receive a grant, then it’s not free. According to the FTC, a real government agency won’t ask you to pay a processing fee for a grant that you have already been awarded — or to pay for a list of grant-making institutions.
Check out grants.gov. This website lists all federal grant-making agencies. It’s a great resource to look if a callers claims to offering a free grant from the federal government.