Grant Writing Newsletter Volume 2 Issue 7

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2 The Nigerian Advance Fee Scam has been around for quite awhile, but despite many warnings, continues to draw in many victims. In fact, the Financial Crimes Division of the Secret Service receives approximately 100 telephone calls from victims/potential victims and pieces of related correspondence per day about this scam! ~Audri and Jim Lanford, Internet ScamBusters What s True & Not True About Grants for For- Profit Businesses & Individuals? Great question. Again we turn to Michael Wells, professional grant writer, author and consultant. I asked Michael some questions about grants for small businesses and individuals, as well as concerns about grant scam artists. Here is part of that conversation. Phil: Is there money out there for forprofit businesses? Michael: The quick answer is mostly not. There s no free money for businesses. There are a few pools of money, like Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) grants if you're engaged in scientific research and development (R&D). If you developed an idea, you can get SBIR or STTR grant funding to take your idea and perhaps turn it in to something that can be sold, turn your idea in to a product. I would call the Small Business Administration as the first place to find out about that ( PAGE 2

3 Also, the other place there maybe money for businesses are local economic development commissions that target specific monies to revitalize neighborhoods and revitalize small businesses. These are really targeted. Talk to your local housing authority or economic development commission about these. In none of those cases, though, is it to your advantage to respond to somebody who comes to you and says there s free money. For individuals, there are a couple of exceptions. Some foundations and even more state and local arts commissions will make grants to individual artists. So, if you're a singer or a playwright or something similar, there are possibilities of getting grants out there. They tend to be pretty small, and they're pretty rare. PAGE 3

4 That s one area that within the way the Internal Revenue Service governs or regulates foundations that if you set up a competition with real parameters, there are grants for individuals. The other thing of course is scholarships for college, mostly undergraduate college scholarships. There are foundations who make those as well. The way to go is not to respond to somebody who calls you. I would talk to someone you know where you are like a high school counselor, college counselor, somebody like that. Find out the ropes. Other than that, there pretty much are not grants for individuals. There are what are sometimes considered grant programs for individuals but they're not things that you write a proposal to apply for. There are things like food stamps or rent subsidies or entitlement programs that you qualify for generally by income. They sometimes get lumped into grants but they're an entirely different thing. These are some of the things actually Matt Lesko talks about in his late night TV infomercials. Well there are these grants, he says. Well, yes there are but unless you're supporting two kids on less than $20,000 a year, it doesn t have anything to do with you. Applications, Training & More Plus Training in FREE PAGE 4

5 Phil: I was able to get a grant to buy my first home but I didn t do any. I didn t apply. It was done through FHA and the developer. There were definitely income eligibility requirements and the first time homeowner requirements. I just got lucky with it. So, I hear that there are some artists, perhaps grant scholarships, maybe some subsidies from the government but not to the extent that s promised by Matthew Lesko and others. Michael: With the exception of perhaps grants for artists, which is a whole different thing, most of those things you're saying - like the first time homeowners credit - these other things, they're not something that you write a grant for. They're determined by your eligibility and working with a staff person at the housing authority or some sort of government office. They do exist but they're not something that you write proposals for, and you would not want to pay somebody money off of your credit card to get for you. PAGE 5

6 Phil: It just so happened in the last couple of weeks I've gotten s from a few small business owners. One in particular promises a $100,000 grant. I got a copy of the contract, and it says they promise to aid and assist the client in obtaining a minimum of 50% or half of the requested grant amount ($50,000). The cost for the service is $6,000 with a retainer fee of $2,800. The retainer is non-refundable. This is for for-profit business owners. It says that once the client has received access to at least 50% of the total requested amount ($50,000) within the first 6 months from the date of agreement, the client will be billed the $3,200 remaining portion of the total fee. On the surface, it looks like it is quasi legitimate. The organization itself is questionable. I know we can check online. You can go to Better Business Bureau. But, it seems to be a scam. The scammers seem to be willing to settle for the $2,800 retainer fee and probably won t deliver on their services. Michael: They're really after $2,800. They're not after $6,000 unless they ve gotten your bank account information or your credit card in which case they will very likely bill you for the rest whether or not you tell them anything. One of the things in these situations is that they're real hard to tie down. If one of these telemarketers calls you and you say, Gee, can I have a number to call you back? Or, what city are you calling from? Or, can I get an address to get in for more information from? They avoid that. They really want to stay anonymous. They prefer to operate by credit card. Sometimes they're out of the country which makes them much harder to trace and prosecute. I'm not just talking about Third World countries. A lot of them are across the border in Canada. They're PAGE 6

7 immune to American prosecution or at least it s a lot harder to go after them. If you're tempted to go after any of these telemarketing offers, see if you can get an address and a phone number because they tend to be very reluctant to give you that information. Phil: So if you ask for the address and phone number and notice they are reluctant to give you that information, then that in and of itself might also be an early warning sign. Michael: Yes. I got telemarketed once and they said, Your local representative will contact you. I was guaranteed something like $6,000 of government money for only $300. If I would only give him my bank account number including the routing numbers, my mother s maiden name, and my social security number. PAGE 7

8 Because I'm in a grant writing field, I made up a number and gave it to him. He said, You know, we will not access your bank account until 60 days when you ve received your number. He called back in less than a minute and said That s not a good bank account number. Can you read it to me again? They were into my bank account within seconds or at least what they thought was my bank account. I went through quite a discussion with that guy trying to get any kind of contact information: telephone number and city they were based in. Of course, they said they were based in Massachusetts, when they were actually in Jamaica. your due diligence, that also sounds like a warning sign. Michael: Yes. Actually, I would say, if you're being telemarketed for grants that s a warning sign in and of itself because there s nobody legitimate doing that. Thank you, Michael! Warmest regards, Phil Johncock Editor Phil: One of the things you said earlier that stuck in my mind was not to sign the agreement or to give out full information to a telemarketer or even online until you ve had an opportunity to talk to somebody else. So, if a person is resistant for you to check it out, to do PAGE 8

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