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Education Grant Scams: Don't Get Fooled

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Con Artists Fraudulently Offer "Free" Education Grants

Well, here's one old profession that always thrives during hard times: con artists promising access to free money, including government education grants, just when you need it most.

In the 21st century, con artists have a vast new audience to exploit; via the Internet, they can reach millions of people. You may want to go back to school—and that's a good idea when you lose your job and want to start over—but don't let Internet scammers fool you into giving them your credit card number for education grant information you can get for free on a number of legitimate federal government sites. This is nothing more than an education grant scam, and there are dozens of them. They offer you a "grant kit" for only $1.99, then immediately sign you up for their grant-writing "help center," charging your credit card anywhere from $25 to $100 a month - forever. Very often, by the time you realize what's going on, it's too late to back out.

"Don't Fall for Their Education Grant Scam; We're the Real Thing!"

Many of these websites actually warn you in great detail of such education grant scams, only to assure you that they are genuine and to suggest that you buy their education grant information instead. Slick.

On March 3, 2009, both the Federal Trade Commission and the national Better Business Bureau published press releases warning consumers about the education grant scams. In the days following, some of the education grant scam sites were removed from the Web. But they'll be back, with a different website and a new pitch, but the same old scam: "Give us your credit card, give us your bank account, and we'll show you the way to free money." Don't be fooled! If it sounds too good to be true - you're right.

Here is the Federal Trade Commission warning:

FTC Warns Consumers About Economic Stimulus Scams

The FTC is warning consumers that they could get stung by an economic stimulus scam. The scams come in different forms.

Right now, on the Web and in e-mail, scammers are telling consumers they can help them qualify for a payment from President Obama's economic stimulus package. All they have to do is provide a little information or a small payment.

E-mail messages may ask for bank account information so that the operators can deposit consumers' share of the stimulus directly into their bank account. Instead, the scammers drain consumers' accounts of money and disappear. Or bogus e-mail may appear to be from government agencies and ask for information to "verify" that you qualify for a payment. The scammers use that information to commit identity theft. Some e-mail scams don't ask for information, but provide links to find out how to qualify for funds. By clicking on the links, consumers have downloaded malicious software or spyware that can be used to make them a victim of identity theft.

"Web sites may advertise that they can help you get money from the stimulus fund. Many use deceptive names or images of President Obama and Vice President Biden to suggest they are legitimate. They're not," says Eileen Harrington, Acting Director of the FTC's Bureau of Consumer Protection. "Don't fall for it. If you do, you'll get scammed."

Some sites suggest that for a small sum of money - as little as $1.99 in some cases - consumers can get a list of economic stimulus grants they can apply for. But two things can happen: the number of the credit card the consumer uses to pay the fee can fall into the hands of scam artists, or the $1.99 can be the down payment on a "negative option" agreement that may cost hundreds or thousands of dollars if the consumer does not cancel.

"Consumers who may already have fallen for these scams should carefully check their credit card bills for unauthorized charges and report the scam to the FTC," Harrington said.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC's Web site provides free information on a variety of consumer topics.


Source: FTC Warns Consumers About Economic Stimulus Scams