Being offered free money, especially from the federal government, is exciting. Think of the many ways you can use your "funds" to acquire a home, invest in business, or pay for your bills and college fees. But, watch out. While the government does provide grant funds, there's no such thing as easy money - money that you have not applied for.
Federal grants are awarded to states, city governments, organizations, educational entities or individuals who have applied for funds. There's a grant application form required to process your eligibility. According to the National Procurement Fraud Task Force, the U.S. government awards nearly $450 billion in Federal Assistance Agreements annually, in the form of grants, to help support community development projects and programs, fund research, and promote the arts and social sciences.
However, these federal grant funds are susceptible to various forms of scams. Scam artists have found ways to potentially lure you to part with your hard-earned money, while you will be left nothing in return.
Here's how to detect a potential scam and avoid being victimized:
Over the phone
The Internet is packed with websites that offer "free grants" ads or any kind of bogus grant information. A federal grant scam site is likely to feature:
Whom to contact
If you think you've been contacted by a scammer, or have been scammed, you can file a complaint with the Federal Trade Commission (FTC). You can send a complaint online via their website, or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.
FTC inputs scam-related complaints into its Consumer Sentinel database, a free investigative online tool, which grants federal, state or local law enforcement members access to complaints provided directly to FTC by consumers.
FTC also cautions to take control of calls that you are receiving since scam artists are likely to conceal their area code. They might be contacting you from anywhere in the world. FTC advises to register your telephone number on the National Do Not Call Registry if these calls are becoming persistent.
Register online: donotcall.gov.
Register by phone: 1-888-382-1222 (TTY: 1-866-290-4236)
You can also visit the Council of the Inspectors General on Integrity and Efficiency website, where its duties include detecting, investigating, and preventing grant fraud, waste and abuse.
The Social Enterprise Law Association (SELA), founded by Bea Hinton and Thea Sebastian, is a student-led organization at Harvard Law School designed to connecting the rift between the private and public sectors, while offering a space for students to transform their ideas into initiatives by applying their newfound legal skills to build meaningful careers.