Beware of Small-Business Grant Scams
Small business owners are targeted by armed robbers, thieves, crooks and scam artists.
Few small businesses have their own security officers, so my goal for this blog is to provide the crime and security information you need to avoid becoming a victim.
As a crime reporter and crime columnist I've heard law enforcement officers tell of various cons and scams that crooks run on small business owners. One scam offers supposed "government grants."
This week the Nevada Attorney General's office offered an advisory on grant scams.
According to Attorney General Catherine Cortez Masto's office, grant scams usually operate out of telemarketing "boiler rooms" with calls aimed at small businesses. The telemarketer informs the small business owner that he or she is qualified for a large amount of grant money, and the money will be sent in a few days.
All the business owner has to do to receive the large sum grant is pay the grant writer anywhere from $2,500 to $7,000.
The Attorney General's office also notes that the crooks often tell the victim to incorporate their business as a "non-profit" corporation in Nevada in order to receive the grant -- for an extra fee, of course. The scammers may set up the corporation, but the grant does not materialize and the so-called "grant writer" disappears.
In reality, such grants are very rarely available to small businesses.
No one can "guarantee" that an applicant will receive a grant. Grants are difficult to obtain in the best of circumstances, the Attorney General's office notes, and the application process is slow and complicated. Government grants are usually aimed at the needy, educational institutions, and specialists who provide assistance to the government.
Grant scams are not new, but the scams continue to impact new victims.
The Federal Trade Commission (FTC) offers the following tips to avoid being victimized by 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 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. 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.
Phone numbers can deceive. Some con artists use Internet technology to disguise their area codes in caller ID systems. Although it may look like they're calling from Washington, DC, they could be calling from anywhere in the world.
If you believe you've been victimized, call the FTC at 1-877-382-4357.
