The Ultimate Guide to Beat Government Grant Scams

Government Grants Scams

Government grants scams are difficult to spot and easily to fall for. Today’s post will teach you how to spot grant scams, and most importantly, how to beat grant scams by not falling for them in the first place.

First, government grants are difficult to get. On average, only about 3 to 8 percent of competitive grant proposals submitted, get funded. There are exceptions of course, with some programs funding as many as 50% of proposals submitted, but those are the exceptions, not the rule. In preparing grant proposals, you must submit the proper documents, with the proper information, and meet all other program requirements to get awarded the grant you seek.

This is all very time consuming. Developing a compelling grant proposal that gets funded can take anywhere from 40 hours of effort to well over 200 hours of effort, depending on the program or funding award level.

Many people are very aware of this and have built entire businesses around telling others that the federal government has billions of dollars in “free money grants,” available just for asking. They will also tell you that the government offers grants to women, persons belonging to traditionally underrepresented populations, military veterans and more so they can start a business, pay off debts or do something else they would like to do, if they only had the money.

But this is just not true. The government never offers grants to start a business, pay off debts or simply because you are a woman, a veteran or belong to a traditionally underrepresented group. Deception is at the core of every scam, and the people telling you otherwise, seek to take advantage of the vulnerability of people who are desperate.

Here are some of the most common types of grant scams and how you can protect yourself when you are confronted with these situations:

  1. Phone, text, email or paper mail, messages that say you are eligible for a government grant. Note that the government doesn’t individually contact people to tell them that they have been given grants — especially if you didn’t even apply in the first place. This probably comes from someone who wants to get your private data such as your bank account number or Social Security Number. A number of television ads and websites make this fall claim about government grants.

Steps to Report Fraudulent Grant Activity

If your suspicions have been alerted about a potential government grant scam, the Federal Trade Commission is the office where you should lodge your complaint. Its contact number is toll-free at 1–877-FTC-HELP (1–877–382–4357).

Make sure to include pertinent information so that the authorities can crack down on the scam perpetrators. Mention the date and time of the call or the email and also the name of the government agency used by the scammer.

Provide details about what they told you, the amount of money they are asking for, as well as the payment method. Document the phone number or email address of the scammer for tracking purposes.

Other grant-related scams can be reported to the U.S. Department of Health and Human Services (HHS). Their fraud hotline is 1–800–447.8477.

Here is What the Federal Trade Commission Says

  • Avoid sending money: One of the reasons why scammers do what they do is to get money. And if you get fooled into sending cash, it’s almost untraceable. Likewise, don’t share your bank or credit card account information. You never have to pay taxes or insurance for a grant you have supposedly been awarded. Remember — if you didn’t submit a grant proposal in the first place, you can’t win. Don’t ever pay any money for a “free” government grant. It’s not free if you have to pay for it. Government agencies would never 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. 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 Grants.gov.

There you have some of my best tips for beating grant scams. If you’re interested in learning how to actually WIN a grant, then talk to us! We have won more than $800 million in funding for our clients.

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Ron Flavin

I love entrepreneurship and helping businesses and organizations build foundations for growth and funding success. Let’s talk startups, growth and leadership!