Business-Loan / Grant Broker-Fee Scam
A 'broker' promises fast business funding or a government grant but requires upfront broker, application, or 'insurance' fees — for funding that never comes.
Think a message like this reached you? You can check it right now.
What this scam is
Small-business owners are pitched quick funding, a line of credit, or a government grant, contingent on paying an upfront broker, application, or 'insurance' fee, often by wire. The funding or grant does not materialize, and more fees may be demanded. Government grants are not given out via cold calls for a fee, and legitimate lenders do not require upfront fees paid by wire to strangers. The fee is the scam.
What it usually looks like
- An offer of fast business funding or a grant.
- Upfront broker/application/insurance fees.
- Payment by wire to a broker.
- Claims tied to the SBA or a government program.
Common warning signs
- Upfront fees to secure funding or a grant.
- Government-grant offers for a fee.
- Wire payments to unverified brokers.
- Guaranteed approval.
Example wording scammers use
“Your business qualifies for a $50,000 grant — pay the $1,500 processing fee to release it.”
“Fast funding approved; wire the broker fee and your capital arrives in 48 hours.”
These are illustrative examples written by ScamSplain, not real messages.
What the scammers want
- Upfront broker/processing fees by wire.
- Your business and bank details.
- To profit from funding hopes.
What to do
- Never pay upfront fees to secure a loan or grant.
- Apply for real SBA programs at sba.gov and grants at grants.gov (free).
- Verify lenders and brokers independently.
- Avoid wiring fees to strangers.
What to do if you already responded
- Contact your bank about the wire immediately.
- Report to the SBA OIG and reportfraud.ftc.gov.
- Watch business accounts for misuse.