Watch Out for Grant Scams

Con Artists Offering “Free” Access to Government Grants Come Out of the Woodwork
Here’s one old profession that always does well during hard times: con artists promising you an easy, gold-paved road to free money, including government grants for education.

Watch out for these Internet grant scams promising to send you information on free government grants and displaying recognizable brand names of people or companies that allegedly endorse their grant info product. If you give your bank or credit card information to one of these grant scam websites, you are opening yourself up to being charged for services that you didn’t agree to or even know about.

Grant Scams: Just $1.99!
There are dozens of these grant scam sites, which offer to send you a CD of grant resources for “just a shipping fee” of a couple of dollars. All you have to do is give them your credit card number or bank account number so they can charge you for the shipping. Sound like a great deal? Well, buried deep in their fine print is the catch: once they have your credit card number, they charge you anywhere from $49 to $100 a month, continuously, if you don’t cancel your “membership” in their “service” within the cancellation period – often, just 7 days (…if you’re lucky. Judging from the complaints we found on watchdog sites, it’s very difficult to contact anyone, and if you are able to reach someone, it’s very difficult to get reimbursed.) Even if you manage to cancel, you may have given away your credit card number to identity thieves.

“Don’t Fall for Their Grant Scam; We’re the Only Genuine Article on the Web!”
Many of these grant scam sites, which are cleverly exploiting both the new economic stimulus bill and people’s fears of a protracted recession, actually warn you in great detail of other sites’ scamminess, only to assure you that they, of course, are genuine – and to suggest that you buy their grant information instead. Nice.

On March 3, 2009, the Federal Trade Commission and the national Better Business Bureau published separate press releases warning consumers about the grant scams. Here’s a quote from the BBB:

E-mail messages may ask for bank account information so that the operators can deposit consumers’ share of the stimulus directly into their bank account. Instead, the scammers drain consumers’ accounts of money and disappear. Or bogus e-mail may appear to be from government agencies and ask for information to “verify” that you qualify for a payment. The scammers use that information to commit identity theft. Some e-mail scams don’t ask for information, but provide links to find out how to qualify for funds. By clicking on the links, consumers have downloaded malicious software or spyware that can be used to make them a victim of identity theft.

Some of the grant scam sites are gone now, taken down from the Web in the days following the FTC and BBB press releases. But they’ll be back, with a different website and a new come-on… and the same old scam: “Give us your credit card and we’ll show you the way to free money.” Going back to school is a good idea when you lose your job and want to start over – but don’t let Internet scammers fool you into giving them your credit card number for information you can get for free on legitimate grant and scholarship sites. If those testimonials sound too good to be true, well, you’re right.

Read the entire Better Business Bureau grant scam press release
Read the Federal Trade Commission grant scam press release at

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