AARP Eye Center
It might start with a phone call from the "Federal Grants Administration" (which doesn’t exist) bringing news that you’re eligible for a lucrative grant the government is providing to help people just like you. Perhaps you spotted a website or social media post promising "free money from the government," or received an instant message from someone who claims she was just awarded thousands of dollars in federal funding and provides a number you can call to get your share.
If it sounds too good to be true, that’s because it is. The federal government awards billions of dollars a year to organizations and institutions for all sorts of programs, projects and research, but it does not give grants to individuals to pay their bills or start a business.
Scammers dangle the prospect of government largesse to trick people out of their money. If you respond to the pitch, they'll ask you to send a money order, make a wire transfer, or provide credit card or bank account information to cover processing fees for the grant. They may also say they need your Social Security number to verify your identification.
Once they collect that first payment, the thieves may ask for additional fees — but the promised grant never materializes. Worse yet, they now have the personal and financial information they need for identity theft. (The same goes for a cousin of the grant scam, in which the crooks claim the government is holding valuable unclaimed property of yours that you can obtain if you pay a fee or provide personal info.)
Social media has become the most common way government grant scammers scout for victims, according to the Better Business Bureau's 2019 Scam Tracker Risk Report. Here are some tips on how to avoid being taken.
Tips to Avoid Government Grant Scams
Warning Signs
- A supposed government official calls you out of the blue to say you’re eligible for a grant. The government only contacts people about grants if they’ve filed an application, according to Grants.gov, the official website for federal grant information.
- You're asked to pay a fee. There is never any charge to apply for or increase your chances of getting a federal grant.
- The grant offer is presented as something secret or exclusive ("You can't get this information anywhere else!").
- A website, email or social media post claims you’re eligible for a government grant to spend any way you choose. There are benefit programs to help people pay for food, housing, health care and other living expenses but no such grant programs.
