Scammers offering fake government grants

Portland man lost $16,000 to scammers offering a fake government grant.

“It makes me mad because I don’t have any money to lose. I’m on social security and I have a pension but I worked hard for my money,” said Simpson of Northeast Portland. “I have no idea where the money is.”

The Federal Trade Commission warns scam artists advertise “free grants” in newspaper classifieds or online. They also call victims out of the blue claiming to be from a government agency or some other organization with an official sounding name. The crooks promise money for education, home repairs or unpaid bills.

“They’re targeting all ages of consumers,” explained Charles Harwood of the FTC.

The trouble started for Michael Simpson after getting a phone call from a man offering a government grant. The caller asked basic questions to see if Simpson qualified.

“He came back on the phone and said, ‘Yeah, you have qualified for a grant and it’s going to be $60,000,'” explained Simpson, who was skeptical, but the man on the phone reassured him.

“He was a fast talker and when somebody is a fast talker and gives you a big line, sometimes you just sort of go along with the program not thinking about it,” said Simpson.

The scammer asked for Simpson’s credit card to pay a $2,000 processing fee

“He said, ‘What’s going to happen is, we’re going take some money off of this credit card and then once you get the grant, we’ll pay off your entire credit card,'” said Simpson.

The scam didn’t stop there. Over the next few months, the crooks demanded more money. They wanted thousands of dollars to help set up a business. To make it seem legitimate, the con artists sent Simpson contracts, business cards and a laptop computer.

“I’m thinking, ‘they sent you a computer, this is the real McCoy,'” explained Simpson.

“This could happen to anybody,” said Simpson. “These people are scam artists.”

The FTC explains crooks often claim legitimacy by using an official sounding name, like the “Federal Grants Administration.” The criminals also lie about where they are calling from.

The FTC posted the following rules on its website to help prevent consumers from losing money to “government grant” scams:

Don’t give out your bank account information to anyone you don’t know
Don’t pay any money for a “free” government grant
Look-alikes aren’t the real thing

Read full article and learn more about the FTC and Deceptive Advertising here.

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Disclaimer: This article is provided for informational purposes only. It’s not legal advice, and no attorney-client relationship is created. Neither the author nor FTC Guardian, Inc. is endorsed by the Federal Trade Commission.