Scammers Falsely Guaranteed $25,000 Government Grant

A federal judge stopped a group of scammers who “guaranteed” a $25,000 grant from the U.S. government, in the Federal Trade Commission’s latest effort to crack down on frauds fueled by the economic downturn. The Federal Trade Commission, along with the attorneys general of Kansas, Minnesota and North Carolina charged that Grant Writers, LLC falsely promised consumers that they were eligible for grants as part of the economic stimulus package.

The interrelated group of Overland Park companies named in the suit includes Affiliate Strategies, Inc., Landmark Publishing Group, Answer Customers LLC and Apex Holdings International LLC. The lawsuit asks that the companies refund the money taken from customers.

According to the FTC, Grant Writers LLC (GWI) mass-mailed postcards promising federal funds since at least 2007. Those who call a number on the card are pitched a $59 book titled “Professional Grant Writer ‘The Definitive Guide to Grant Writing Success.’”  North Carolina-based telemarketers tell callers that the book explains how to get government grants, including the aforementioned $25,000. GWI and the telemarketers, also named as defendants in the case, then continue to call with offers of expensive grant research, coaching or writing services. Few, if any of GWI’s customers ever receive grant money.

Federal Grant Information is Free

The FTC is saying that in addition to guaranteeing customers a grant, GWI used the federal government stimulus package to make its false pitch. There’s no reason to pay for guides or software when receiving government grants, the Better Business Bureau says. Free information about legitimate government grants is already available on sites like grants.gov and studentaid.ed.gov.

“Dozens of websites claim that, because of the recently passed stimulus package and other actions taken by President Obama, consumers can easily get government grants to pay bills or get out of debt,” the BBB said in March. “Contrary to such claims, the federal government does not award grants to help consumers pay general debt and complaints to BBB show that people who sought free advice were ultimately charged as much as $69.95 on their credit or debit card.”

Cracking Down on Stimulus Package Scammers

The FTC’s law enforcement sweep on recession scammers has been dubbed “Operation Short Change.”  The campaign, which began on July 1, initially brought eight cases against companies that target those hit particularly hard by the economy. Rising unemployment and anxiety makes consumer particularly vulnerable to con artists, according to David Vladeck, Director of the Bureau of Consumer Protection.  “There is no such thing as a guaranteed grant. But to consumers in financial trouble, the chance for extra income—guaranteed or otherwise—can unfortunately be a huge draw.”

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