The economic stimulus package was only signed last month, but already there are numerous scams trying to lure people with promises of free government cash. The Federal Trade Commission and Better Business Bureau are sounding alarms.
Kristann Hartley lives in northwest Ohio and heard that the stimulus package had money to help people weatherize their homes. So she used her computer to try to find information and ran across uspublicgrantservices.com.
The Better Business Bureau says this Web site is a scam, like so many others out there offering government money that doesn't exist. But Hartley didn't know that.
"In a little bit less than a week later, I received a phone call from a gentleman who said he was in Washington, D.C., with the Department of Housing and I had been approved for this grant," she says.
The man on the phone told her she could get up to $25,000. She just needed to provide a copy of her deed and estimates from contractors, he said.
Hartley says she was excited and thought, "I'm really glad I'm going to be able to do this."
But she got suspicious when the caller told her about a $385 underwriting fee to be paid by cashier's check.
Calls we made to operators of the Web site seeking comment were not returned.
Economy Boosts Scammers
Sue McConnell, with the Greater Cleveland Better Business Bureau, says that as the economy has gotten worse, reports of scams have intensified.
She says, "The stimulus package has given these scammers a new hook: 'Aha, we can tell people, you know the stimulus package. The government has all this money now. They're going to help us.' "
There are people out there just trying to steal personal information, or angling for some wired cash. And then there are businesses McConnell says are less than legitimate, though maybe not illegal.
A Google search for "stimulus plan" demonstrates how easy it is to accidentally end up on one of these scam sites, she says. A recent search result included a sponsored link that said: "New Obama stimulus checks. I already received my grant."
Some of the sites look like personal blogs, with regular people talking about how they got rich by applying for government grants. Many of the sites promise a free CD with information about applying for the grants. But they charge a small fee for shipping, which has to be billed to a credit card. And that registers the customer for a subscription service.
"But then, if you don't cancel within 14 days and there is a very detailed and complicated cancellation procedure described in the text, you will be billed a one-time fee of $99," Eileen Harrington, with the Federal Trade Commission's Bureau of Consumer Protection, said at a news conference in Washington last week.
But wait, there's more: A monthly fee, too, and other charges. Over a year, Harrington said, that subscription can add up to $1,000 — all for stuff Harrington says people shouldn't be paying for in the first place.
"The government does not charge people to apply for a grant, and you shouldn't pay money for a list of government grants," she said.
But so long as some people do pay for those lists, there will be businesses willing to sell them.
Real, free information about the stimulus can be found on the government site recovery.gov.
Tamara Keith reports for member station WCPN.
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