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Avoid Grant Scams

You've won Free Money – just send me $$$...
A Circular Arrangement of 100 Dollar Bills

No legitimate federal government employee would ever call you and tell you that you qualify or have been approved for a grant for which you never applied. Protect yourself from scammers that tell you that you need to pay a small processing fee to qualify to receive a grant for education costs, home repairs, home business expenses, or "money for nothing" grant offers.

How they try to trick you

Whether you see them in your local paper or a national magazine, or receive direct phone calls—con artists generally follow a familiar script to gain access to your bank accounts or to get you to make unnecessary one-time payments to them.

Look and listen for these tell-tale lines:

  • "This grant/scholarship is guaranteed or your money back."
  • "You can't get this information anywhere else."
  • "I just need your credit card or bank account number to hold this grant/scholarship."
  • "We'll do all the work. You just pay a processing fee."
  • "The grant/scholarship will just cost you a one-time fee."
  • "You've been selected" or "you are eligible" to receive a grant/scholarship.

People who run scams often claim to provide help and sometimes claim to be "federal government" officials—don’t be fooled by these scams that request money from you. It is illegal to ask you to pay to apply for or to increase your odds of being awarded a federal grant.

Be careful to watch for scammers that falsely use HHS symbols and language to trick you and others. Fraudsters in the past have used the words and letters of HHS programs to give the false impression that their costly seminars or pay-per-use grant application tools are approved, endorsed, or authorized by HHS. HHS never endorses or uses private companies or individuals for these purposes.

Phone numbers can deceive. Some con artists use Internet technology to disguise their area code in caller ID systems. Although it may look like they’re calling from Washington, DC, they could be calling from anywhere in the world. You can't rely on caller ID because scammers know how to rig it to show you the wrong information (aka "spoofing"). Scammers might have personal information about you before they call, so don't take that as a sign they're the real thing. If you're not sure whether you're dealing with the government, look up the official number of the agency.

Quick Facts about the Government Grant Process

  • Government grant applications and information about them are free.
  • The names of agencies and foundations that award grants are available for free at any public library or on the Internet.
  • The only official access point for all federal grant-making agencies is www.grants.gov.
  • There are no fees associated with applying for a government grant.
  • ALL government grants involve an application process to carry out projects with a public purpose and are not intended for personal use.
  • You will not be contacted by the government to make you pay for a grant.

If you think that someone has fraudulently represented Grants.gov or HHS, contact the HHS Fraud Hotline at 1-800-447-8477 and email support@grants.gov.

Things You Should Do to Protect Yourself from Scammers

The FTC says following a few basic rules can keep you from losing money to these "government grant" scams:

  • Don't give out your bank account information to anyone you don't know. Scammers pressure people to divulge their bank account information so that they can steal the money in the account. Always keep your bank account information confidential. Don't share it unless you are familiar with the company and know why the information is necessary.
  • 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 a government grant and 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. Specifically, Federal government agencies and employees never ask people to wire money or use a prepaid debit card to pay for anything. Be careful. Prepaid cards and money transfers are like sending cash—once it's gone, you can't get it back.
  • Check the USA.gov Index of Government AgenciesLook-alikes aren't the real thing. Just because the caller says he's from the “Federal Grants Administration” doesn’t mean that he is. There is no such government agency. Take a moment to check the USA.gov site or the blue pages in your telephone directory to bear out your hunch—or not.
  • Take control of the calls you receive. If you want to reduce the number of telemarketing calls you receive, place your telephone number on the National Do Not Call Registry. To register online, visit donotcall.gov. To register by phone, call 1-888-382-1222 (TTY: 1-866-290-4236) from the phone number you wish to register.
  • 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, or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available to hundreds of civil and criminal law enforcement agencies in the United States and abroad.

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Content created by Division of Grants
Content last reviewed on May 18, 2015
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