Robert B. Marks (garwulf) wrote,
Robert B. Marks
garwulf

Leadership Grants - I may have just encountered a scam...

Well, I certainly feel like my time was wasted.  Other than that, I don’t know if I just encountered a scam or not.  I really have no idea – I know that some of what I saw raised red flags, and I can document my experience in this situation.  But, I honestly can’t tell you if this was a scam, or something else.

At the beginning of June, I decided to seek some additional funding to help expand Legacy Books Press.  Hoping to come across a grant that would allow me to gain some additional funding debt-free, I discovered Leadership Grants of Canada, which claimed to provide funding for the expansion and creation of small businesses.

At the time, I will admit, I did not do the research I should have.  I was just happy to find something that looked like it was a legitimate government business grant organization.  So, I applied for a grant.  Upon the receipt of my initial application, I was directed to log into the website and fill out a business plan template.  I was also referred by Shelley Barnes, the representative of the Leadership Grants organization, to another organization called Insights Marketing and Communication – Ms. Barnes had a representative there, Arlene Anderson, contact me by email offering a free consultation.  It may or may not be notable that at no point did I actually request any consultation or referral.

As I am a professional writer, I ignored the email from Arlene Anderson (who, I should add, is a managing director of Leadership Grants according to the Better Business Bureau) and worked on the business plan myself.  The business plan template was, put simply, atrocious.  There were numerous points where it was difficult to tell where information should go, several sub-sections were repeated (sometimes in odd places), and at least one section had conflicting instructions.  The actual act of filling out the business plan was extremely stressful, and occupied a great deal of time.  Finally, I just took an editorial hatchet to the thing, cutting out anything redundant or nonsensical.

After sending a copy of the plan to my sales and marketing contractor and getting sales projections from them, and then applying the above mentioned editorial hatchet, I uploaded the plan to the Leadership Grants website.  They promptly sent me an acknowledgement and a request in writing for due diligence information.

It was here that the red flags really started to appear.  They asked for some things that made a great deal of sense, such as a copy of my business license and industry qualifications.  They also asked for a credit report.  Not authorization for a credit check, which I was happy to provide – the credit report itself.  Besides the fact that this is not a loan, it is very odd that they are unable to request the credit check themselves.  And that’s when I looked them up properly.

Many of the reported experiences with Leadership Grants are quite negative.  One person reported attempting to locate their Toronto office without success.  A common story was being funnelled into a business plan writing service, which would then charge $1500 to $3000 for a business plan, without success in acquiring a grant.

Another red flag was raised by their payment terms – requiring that a grant recipient provide a letter of thanks is nothing new, or out of the ordinary.  However, Leadership Grants requires that this letter be provided before the funds are disbursed.  I have never heard of this being done.

At this point, I wrote to Shelley Barnes, pointing out that their request for a credit report had raised a red flag, and that further investigation had uncovered disturbing information.  I asked her to provide proof that funds had been disbursed (date, amount, and recipient), and to identify some of the donors, as well as provide contact information for independent verification.  The answer I received was a reassurance that Leadership Grants was not a scam wherein the promise of a grant was used to sell a guide to government grants, and a statement that she could not provide any references.  At the same time that she wrote that she could not provide references, she directed me to the Leadership Grants website and its list of recipients, telling me that it could all be independently verified.

(I must comment that this was a very odd email to receive.  I sent in an email requiring proof of disbursement and independent verification, and was flat out told “No, we can’t provide you with references, and on the website you’ll find references.”  Talk about mixed messages...)

At this point, I used Google and the Leadership Grant website to locate and email five listed recipients.  I told them that the organization had listed them as a grant recipient, and asked them if they had actually received any money.  The results, to say the least, were mixed.  Only two of the five wrote back.  The first wrote back to warn me that she thought the organization was a scam, although when I replied to confirm whether she had actually received any grant money, she did not reply.  The second told me that she had indeed received grant money from them, but that she was very puzzled that she was listed as a current grant recipient, as the grant had been issued two and a half years ago.

Having given several days for replies to come in from my own due diligence, I wrote back to Shelley Barnes, telling her that the results had been mixed, but that I had been able to confirm that funds had been disbursed in the past.  Therefore, I was willing to provide the due diligence paperwork they had requested on two conditions: first, that while I was willing to provide them with authorization to run a credit check, I would not do the check myself; second, while I was willing to provide a thank you letter for whatever purposes they required, it would be provided only after the funds had been disbursed.  Ms. Barnes wrote back in the same day, telling me that while she understood my concerns, she could not change the application process.

At this point, I politely told her that considering the red flags, the inability to provide references, and the mixed results from my own due diligence on them, I would not be continuing the application process.  She replied with equal politeness to tell me that she had closed the file.

So – was this a scam?

The truth is that I just don’t know.  It would not surprise me in the slightest if there was a kickback scheme in place, and the main source of income for the organization was from fees for business plans.  There was certainly an effort to get me to contract the business plan out to somebody associated with the organization.  At the same time, I personally confirmed that two and a half years ago they had disbursed grant money.  At all points in time, Shelley Barnes was polite, and at no point was I asked for money by the Leadership Grants organization itself.

At the same time, though, I can’t help but feel that something is very wrong.  If nothing else, the fact that a Google search on the address they provide does not actually come up with a Leadership Grants office is disturbing – what does come up at this point is Bookmyticketman – as is their inability to provide references.  This may not be a scam by the strictest definition of the word, but I don’t think it’s honest.  And, once you have fake addresses in play, something is happening that is definitely fraudulent.

I guess I should be happy, in the end.  My time was wasted, but I did get a business plan out of it.  And, I discovered that something was wrong before anything involving bank account numbers or important personal information was disclosed.  There are times when that is the best case scenario you can get.

Tags: leadership grants, scams
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