Don’t Fall for These 5 Scams That Promise Financial Relief
Written by
Dawn Allcot
Edited by
Jenna Klaverweiden
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As Americans continue to struggle with inflation, many are now fearful of a recession. According to a recent Harris Poll conducted on behalf of Intuit Credit Karma, 57% think the news reports of an impending recession reflect the current economic situation. However, 22% call the forecasts “overblown and exaggerated.”
Of those who fear a recession, 42% said they are worried about not having enough cash for basic necessities, including food, rent and other bills, according to the report. This vulnerability can make people more likely to fall for scams promising free money.
Watch out for these scams that are spreading across the internet and social media, learn how to spot them, and report them if you see them.
Subsidy Cards
One of the most recent — and widespread — scams involves social media ads promising subsidy programs or subsidy cards to low-income Americans. These ads may declare that you can claim government subsidies to help pay for groceries, rent, gas and more. They may use fake testimonials to entice you and coerce you into providing personal information and even bank account information to claim your money “before it’s gone,” according to Malwarebytes.
Programs like SNAP and WIC do exist to help lower-income Americans who are struggling with food costs. But these programs aren’t advertised on Facebook. If you think you may qualify, check with your local SNAP office, since benefits are administered by each state. You can also visit 211.org or call 211 to find out about any legitimate programs available to help with emergency funds.
Federal Grant Money
If you receive a call, email or a letter saying you have won a grant, think twice before responding. If you haven’t applied for any grants, it’s likely a scam, according to Score. Also, keep in mind that most grants are free to apply and are typically awarded to businesses, not individuals. If you’ve won a grant, you won’t have to pay any money to claim the grant funds.
If you apply for a business grant, keep track of when you applied and when you should expect to hear back. If you aren’t sure if a grant is legitimate, you can check Grants.gov to see if it’s real. Most agencies that offer grants will reach out via email to the business email address you used to apply.
Score noted on its website that the Federal Grants Administration, while it sounds official, is not an actual government agency, so if you receive correspondence from that organization, it’s a scam.
Sweepstakes
Sweepstakes scams have been around for years and are especially prevalent at times when people are seeking a “quick win” to get them out of a financial bind. Scammers may call, text or email saying you’ve won a sweepstakes prize such as cash, a trip or even high-end electronics. However, you may be required to provide your account information or make a payment to claim your prize.
Scammers will put the pressure on, convincing you to provide your information or you’ll lose the prize. If you encounter this scam, do not provide any information. Report it to the Federal Trade Commission (FTC) at ReportFraud.ftc.gov.
‘Lottery Winners’ Giving Away Money
Scammers don’t pose only as organizations; they often pose as individuals on Facebook, X (formerly Twitter) and Instagram, promising money to the first people who reply to their post. They might claim they’ve won the lottery and want to pay it forward, or they might offer Bitcoin or other cryptocurrency to their followers.
Before they send you any money, however, they may ask you to put money on gift cards and send the card information to cover processing fees, taxes or delivery, according to the FTC website.
Never give money or gift cards to anyone you don’t know. If a friend or family member requests money, verify in person or on the phone to be sure you aren’t being scammed.
Tax Refund Scams
This is a hot scam right after Tax Day. Bad actors will reach out via email, claiming that you miscalculated your tax refund and you are owed more money. To receive the funds, you’ll need to visit a website and enter your bank information for a direct deposit. Except the website is actually a fake and may install malware on your machine.
Per the IRS website, it does not initiate contact about tax refunds by email, text or social media.
Final Take: If It Sounds Too Good To Be True, It Is
As you navigate the internet and social media, remember the famous phrase “There’s no such thing as a free lunch.” If something sounds like your ticket to financial freedom but has come out of the blue and requires no work, it’s probably a scam.
More From GOBankingRates
Sources
- Intuit Credit Karma, “Americans caught between recession fears and fatigue.”
- Malwarebytes, “The ‘free money’ trap: How scammers exploit financial anxiety.”
- Score, “How to Tell If a Government Grant Offer Is a Scam or Legitimate.”
- Federal Trade Commission, “Free money on social media? Nah. It’s a scam.”
- IRS, “IRS, Security Summit partners warn taxpayers of new scam; unusual delivery service mailing tries to trick people into sending photos, bank account information.”
