A fraudulent company used social media platforms including Facebook to promote fake guarantees of grant money that cost minority-owned businesses thousands of dollars each, it is alleged.
A lawsuit was filed against Grant Bae by the Federal Trade Commission (FTC) and state of Florida, in which it is claimed that the firm offered grants of up to $250,000 to small businesses struggling to keep afloat during the COVID pandemic in return for a fee. The company claimed it would obtain the money on their behalf from the COVID-19 Economic Injury Disaster Loan program.
The commission alleges that Grant Bae put up adverts targeting businesses owned by minorities, which it posted on Facebook, Instagram and Clubhouse, a social audio app. These claimed that companies paying it the fee would receive a guaranteed grant of between $25,000 and ten times that amount within seven days of its “closing date.”
The more the victim agreed to pay, the more money was offered. But in most cases Grant Bae failed to deliver on its promises, leaving cash-strapped businesses hit by the pandemic even worse off than before, the FTC claims.
Grant Bae also failed to honor its “money-back guarantee,” the lawsuit alleges, taking payments via credit card and leaving hapless customers in the dark until “it was often too late for them to dispute charges for thousands of dollars in fees.”
“The case is a reminder that honest businesses will never guarantee that your business will get a grant or loan,” said the FTC. “Any company making that promise is a scam.”
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