FEDERAL TRADE COMMISSION
CONSUMER INFORMATION
"Free Money" from the Government:
Variations on a Scheme
October 20, 2012
by Colleen Tressler
Consumer Education Specialist, FTC
"There is currently money available NOW right here in your area, to help
pay your bills."
"NO lines, NO waiting, NO credit needed. This is YOUR money and will be
sent back to the federal government if not used in your area."
Federal officials, consumer advocates, and businesses are hearing from people who
have responded to ads, websites, phone calls, text messages, and visits from
salespeople who claim the federal government will pay their bills – for everything from
utilities, cable, and cell phones to their mortgages, student loans, and insurance
premiums. The salespeople are scam artists. There is no federal bank account set up to
pay your bills.
The FTC and the Federal Reserve Bank of Atlanta, say these cons are pros who may
use half-truths to draw people in: The federal government has public assistance
programs to help people in need. But this so-called program is a fraud.
If you respond to the scam artist's come-on, they'll charge you a processing fee and ask
you for your personal information, which may include your name, Social Security number
(SSN), credit card number, debit card number or other personal information. In
exchange, they will give you instructions on how to use bank account and routing
numbers to pay your bills online, or print checks so you can make your payments in
person or by mail.
At first, you may think your bills have been paid. It's not until the payment is rejected,
and you're notified that you still owe the money, that the scam is revealed. At that point,
you may owe late or penalty fees to the company you thought you were paying as well
as possibly owing fees to your bank for returned or rejected payments. The damage
doesn't stop there: Not only do you still owe the money, but you're out the "fee" you paid
the scam artist, you're at risk for identity theft, and you could be fined or even arrested
for passing bad checks or trying to use a bank account that doesn't belong to you.
If you see a pitch for this scam, share it with your local police department, Better
Business Bureau, state Attorney General's office, and the FTC. If you followed the
scammer's instructions, contact your creditors immediately. It's also a good idea to
review your credit report, which you can do every twelve months for free. To order a free
copy of your report, call 1-877-322-8228 or visit www.annualcreditreport.com. Look for
inquiries from companies you haven't contacted; accounts you didn't open; and debts on
your accounts that you can't explain. Check that information like your SSN, address(es),
and name or initials are correct. If you find fraudulent or inaccurate information, get it
removed.
The Facts About Getting Government Assistance
The government provides help through benefit programs for job training,
nutritional assistance, education, and health care, among other needs.
To get government assistance, you must apply. Each program has specific
eligibility requirements.
You shouldn't have to pay a fee to apply for a government assistance program.
Not all government assistance programs provide cash payments. Assistance
programs that provide payments may have conditions and limitations.
For More Information
For information about federally-funded benefit and assistance programs, visit
Benefits.gov. If you don't have access to the internet, call USA.gov's National Contact
Center at 1-800-FED-INFO (1-800-333-4636), Monday through Friday, 8 am to 8 pm
Eastern Time, to speak to an information specialist.
CONSUMER INFORMATION
"Free Money" from the Government:
Variations on a Scheme
October 20, 2012
by Colleen Tressler
Consumer Education Specialist, FTC
"There is currently money available NOW right here in your area, to help
pay your bills."
"NO lines, NO waiting, NO credit needed. This is YOUR money and will be
sent back to the federal government if not used in your area."
Federal officials, consumer advocates, and businesses are hearing from people who
have responded to ads, websites, phone calls, text messages, and visits from
salespeople who claim the federal government will pay their bills – for everything from
utilities, cable, and cell phones to their mortgages, student loans, and insurance
premiums. The salespeople are scam artists. There is no federal bank account set up to
pay your bills.
The FTC and the Federal Reserve Bank of Atlanta, say these cons are pros who may
use half-truths to draw people in: The federal government has public assistance
programs to help people in need. But this so-called program is a fraud.
If you respond to the scam artist's come-on, they'll charge you a processing fee and ask
you for your personal information, which may include your name, Social Security number
(SSN), credit card number, debit card number or other personal information. In
exchange, they will give you instructions on how to use bank account and routing
numbers to pay your bills online, or print checks so you can make your payments in
person or by mail.
At first, you may think your bills have been paid. It's not until the payment is rejected,
and you're notified that you still owe the money, that the scam is revealed. At that point,
you may owe late or penalty fees to the company you thought you were paying as well
as possibly owing fees to your bank for returned or rejected payments. The damage
doesn't stop there: Not only do you still owe the money, but you're out the "fee" you paid
the scam artist, you're at risk for identity theft, and you could be fined or even arrested
for passing bad checks or trying to use a bank account that doesn't belong to you.
If you see a pitch for this scam, share it with your local police department, Better
Business Bureau, state Attorney General's office, and the FTC. If you followed the
scammer's instructions, contact your creditors immediately. It's also a good idea to
review your credit report, which you can do every twelve months for free. To order a free
copy of your report, call 1-877-322-8228 or visit www.annualcreditreport.com. Look for
inquiries from companies you haven't contacted; accounts you didn't open; and debts on
your accounts that you can't explain. Check that information like your SSN, address(es),
and name or initials are correct. If you find fraudulent or inaccurate information, get it
removed.
The Facts About Getting Government Assistance
The government provides help through benefit programs for job training,
nutritional assistance, education, and health care, among other needs.
To get government assistance, you must apply. Each program has specific
eligibility requirements.
You shouldn't have to pay a fee to apply for a government assistance program.
Not all government assistance programs provide cash payments. Assistance
programs that provide payments may have conditions and limitations.
For More Information
For information about federally-funded benefit and assistance programs, visit
Benefits.gov. If you don't have access to the internet, call USA.gov's National Contact
Center at 1-800-FED-INFO (1-800-333-4636), Monday through Friday, 8 am to 8 pm
Eastern Time, to speak to an information specialist.
