How to Spot a Grant Scam

A government grant offer is almost certainly a scam if someone contacted you out of the blue, asks for a fee, wants payment by gift card, wire transfer or cryptocurrency, or asks for your bank details or Social Security number. The Federal Trade Commission says the government will not get in touch out of the blue about grants, and that you should not pay for a list of government grants or any up-front fees. Real federal grants require an application, fund a specific public purpose, and are listed for free on Grants.gov.

This guide explains how grant scams work, the warning signs the FTC lists, how real federal grants differ, and what to do if you have already paid. The quotes and rules come from the FTC's guidance on government grant scams, current as of October 2026.

How grant scams usually work

Most grant scams follow the same pattern. You receive a call, text, email or social media message saying you qualify for a government grant, or you see an ad promising free money. The message sounds official and may use a real agency name, a fake one, or a spoofed caller ID. Then comes the catch: to receive the grant, you must first pay a fee, often described as a processing charge, a tax, or a payment to "release" the funds. Or you are asked for bank details so the money can be deposited, which the scammer then uses to take money from your account.

The grant never arrives. Some scammers come back with new fees. Others vanish.

The warning signs the FTC lists

They contacted you first

The FTC says the government will not get in touch out of the blue about grants. Agencies do not call, text, message on social media, or email you to offer a grant. Real federal grants are announced publicly, and you apply for them.

The offer is "free money"

The FTC states that offers of free money from government grants are scams. Real grants require an application and serve a specific purpose, not personal needs like paying bills or making home repairs.

They want an up-front fee

The FTC's advice is direct: do not pay for a list of government grants, and do not pay any up-front fees. A real federal grant never requires you to pay to receive it.

They want unusual payment methods

Scammers ask for gift cards, cash reload cards, wire transfers, cryptocurrency or cash because these are hard to trace and reverse. The FTC says these methods are never used for government grants: "Not for a grant, and not ever."

The agency sounds official but is not

Scammers may spoof caller ID, claim to work for a real agency such as the Social Security Administration, or invent agencies. The FTC gives the example of "the Federal Grants Administration," which does not exist. If you cannot find the agency on an official .gov website, treat the offer as a scam.

They ask for personal or bank information

The FTC says government agencies will never call, text, message you on social media, or email to ask for your Social Security number, bank account or credit card number. Do not share them with anyone who contacts you about a grant.

They promise a refund or a guarantee

Some scammers promise a refund if you are not satisfied, or guarantee you will receive a grant. The FTC calls the refund promise a lie. No one can guarantee you a federal grant, because awards are made by the agency after review.

How real federal grants work

Knowing what a real grant looks like makes scams easier to spot:

• They are published. Federal grant opportunities are announced in a public notice of funding opportunity and listed on Grants.gov. The FTC notes that Grants.gov is the only place to find a free list of federal grants.
• You apply. Every grant requires an application that follows the notice's instructions, usually with a deadline.
• They have a purpose. Grants fund specific public goals defined by law, such as research or community services. They are not general cash for personal needs.
• Most are for organizations. Grants.gov explains that most opportunities listed are for organizations, not individuals. The SBA states it does not provide grants for starting and expanding a business.
• Registration is free. Organizations register in SAM.gov at no cost. SAM.gov is the official system, and registering there is free.

Scams aimed at businesses and nonprofits

Organizations see their own versions of these scams:

• Fake registration notices. Letters or emails that look official and say your SAM.gov registration will expire unless you pay a company to renew it. Renewing in SAM.gov is free, and you can do it yourself.
• "Guaranteed" grant writing. Services that promise you will win a grant if you pay. Grant writing help is a legitimate service, but no honest provider can promise an award.
• Paid grant lists. Directories of "secret" or "unclaimed" grants sold for a fee. Federal opportunities are listed free on Grants.gov.
• Fake award notices. Messages saying you have won a grant you never applied for, with a fee to release the funds.

Questions to ask about any offer

1. Did I contact them first, or did they contact me?
2. Is there a fee before I receive anything?
3. Do they want payment by gift card, wire transfer, cryptocurrency or cash?
4. Can I find the opportunity on Grants.gov or the agency's own .gov website?
5. Are they asking for my Social Security number, bank account or card details?
6. Are they promising or guaranteeing an award?

If the answer to any of questions 2, 3, 5 or 6 is yes, or the answer to question 4 is no, stop. Our Grant Scam Checker walks through these questions for an offer you have received.

If you already paid or shared information

The FTC says to act quickly. Contact the company or bank you used to send the money, tell them it was a fraudulent transaction, and ask them to reverse it. If you paid with a gift card, contact the company that issued the card. If you shared your Social Security number or bank details, contact your bank and watch your accounts closely.

Report it

Report grant scams to the FTC at ReportFraud.ftc.gov. The FTC shares reports with law enforcement partners, which helps with investigations. Reporting also helps warn others, even if you did not lose money.

About GovGrantsUSA

GovGrantsUSA is an independent software platform operated by VRLY Ventures LLC. It is not a government agency and is not affiliated with or endorsed by any government agency. It cannot award grants or speed up an agency's decision. It helps organizations find federal opportunities from public sources such as Grants.gov and prepare applications, which they then submit through the official systems. Searching Grants.gov and registering in SAM.gov are always free, whether or not you use any paid tool.

For more on what federal funding is available, see our guides to federal grants for small businesses and federal grants for nonprofits.

How to check whether a contact is real

If you are unsure about a message, check it yourself rather than replying to it:

• Do not use the contact details in the message. Find the agency's official website on your own, by typing the address or searching for it, and use the contact information listed there.
• Look for .gov. Official federal websites use .gov addresses. A message from a free email service or a look-alike domain is a warning sign.
• Search Grants.gov. Real federal grant opportunities are posted publicly. If you cannot find the opportunity by its name or number, be suspicious.
• Check for an application. If the message says you have already won a grant you never applied for, it is not real.

Legitimate paid help versus scams

Not every paid grant service is a scam. Grant writers, consultants and software tools can save time, and many organizations use them. The difference is in what they promise and how they are paid:

• Legitimate providers describe the work they will do, such as research, writing or review. They do not promise that you will win.
• Legitimate providers do not ask you to pay a fee to "release" grant money, and they do not ask for payment by gift card or cryptocurrency.
• Legitimate providers do not claim to be the government or to have special influence over award decisions.
• You always submit federal applications through official systems such as Grants.gov, under your own organization's registration.

Protecting your organization

Organizations can reduce risk with simple rules. Make one person responsible for SAM.gov and Grants.gov registrations, so staff know that renewal notices from anyone else are suspect. Agree that no one pays a grant-related fee without a second person checking the request. And share the FTC's warning signs with staff who answer phones and email, since they are often the first to see these messages.

Why these scams keep working

Grant scams succeed because they mix a real fact with a false promise. The federal government really does award large amounts of grant funding every year, and the application process really is complex. Scammers use both facts to make a shortcut sound believable. The answer is to remember how the real process works: public notices, written applications, review by the awarding agency, and no fees to receive an award. Anything that skips those steps is not a federal grant.