How to Recognize and Avoid Grant Scams
If an individual contacts you about an opportunity to obtain free money in the form of a grant from the federal government, be extremely wary. You are likely being targeted as part of a scam. Any of the following statements should put you on high alert:
"Great news! You are eligible to receive a government grant."
The government does not contact individuals to award grants for which there has been no application. An individual who makes this claim is not from the government and could be trying to collect private personal data from you, such as your Social Security number, bank account number or other such information.
"For a small fee, you can obtain a government grant."
The government does not charge a fee for individuals or entities applying for a federal grant. While financial information may be required as part of the application process, it should be submitted through a government website, such as Grants.gov, and there should never be a cost to you.
"The Federal Bureau of Grant Awards has awarded you a $8,000 grant."
Beware of individuals claiming to work for grants-related government bureaus and departments that do not actually exist. The individual may even provide a valid address for a government office, adding a touch of realism to their claim, but do not be fooled.
"Our office is located in Washington, D.C."
Current technology can fool caller ID systems into reporting that a caller is phoning from Washington, D.C. In fact, a scam artist could be calling from anywhere in the world. Similar tactics can be used with email addresses in online communication, so be alert!
"This type of federal grant does not require an application."
Every grant from the federal government involves an application submitted through a government website, such as Grants.gov. Also, you cannot apply for federal grants over the phone or via email. Any individual claiming that a grant does not require an application, or requires only a phone call or an email, is attempting to scam you.
"You won the government grant in a drawing."
The government does not award grants based on a drawing or raffle; an individual or entity must first apply for the grant through a federal website, like Grants.gov. Any individual who claims the government is awarding a grant, for example, to a lucky group of citizens who have paid their taxes on time is attempting to scam you.
"You have been awarded a federal grant that you can spend any way you like."
Federal grants are usually awarded for specific programs, research or projects – most often to local governments, organizations, institutions and universities. Beware of any individual who promises a government award that can be spent on paying down tuition or credit card debt, or home electronics and décor.
If you think you may have been a victim of a government grant scam, file a complaint with the Federal Trade Commission online, or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.
You can also report grant-related scam attempts to the Health and Human Services (HHS) Fraud Hotline at 1-800-447-8477.