BBB Warns Consumers of Fake Federal Government Grants

Thursday, October 16, 2014

GoLocalWorcester BusinessTeam

The Better Business Bureau of Central New England has received many calls and inquiries from consumers regarding federal government grants. Consumers allege receiving calls and the caller states they are eligible for government grants, all they need to do is pay a small fee or give out some personal information and they will receive thousands of dollars in return.

BBB is warning consumers to be cautious of these types of calls and to never give out personal information or agree to sending money if you do not know who you are speaking with.

The caller claims to be from a department or agency of the federal government, but most often states a generic name like, Federal Grant Department, a name the consumers may assume to be legitimate, but further research should always be done to confirm.

"Consumers should be cautious of unsolicited phone calls where callers states you have won money," said Nancy B. Cahalen, president and CEO of the Better Business Bureau of Central New England. "Always verify where they are calling from do research before making any agreements with the caller."

Grants.gov states that no government grant-making agency will make phone calls; send email or letters to solicit money or personal banking information from a potential grant recipient. The site also states that federal grants are not issued for personal use; they are intended for institutions and non-profits to carry out projects with a public purpose and there are no processing fees involved.

BBB offers the following tips to help protect you from this type of scam:

-Do not give personal or banking information over the phone to anyone claiming to be from the federal government or other agency. Call you bank immediately to prevent unauthorized access to your account.
-Be cautious of requests to wire money or pay using GreenDot Moneypak or similar reloadable debit card. These forms of payment are often used by scammers because they are virtually untraceable and once you send the money or share the pin numbers, you cannot get the money back.
-Do not let the caller pressure you. Demanding immediate actions is a red flag. If the call is legitimate, the caller should be willing to allow you to look into the information and follow up with them at a later time.
-Don't pay any money for a "free" government grant. If you have to pay money to claim a "free" government grant, it isn't really free. 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.
-Look-alikes aren't the real thing. Just because the caller says they're from the "Federal Grants Administration" doesn't mean that they are. There is no such government agency. And although it may look like they're calling from Washington, DC, they could be calling from anywhere in the world.
-File a complaint with the FTC. If you think you may have been a victim of a government grant scam, file a complaint with the FTC online, or call toll-free, 1-877-FTC-HELP.