Don't Pay For An Education In Fraud: Protect Yourself From Scholarship Scams

There are a lot of "official" looking offers that will come your way when you start looking for scholarships, grants, and loans for college. You will hear of these so-called offers at seminars, in emails, over the phone from telemarketers, and online. These offers and their websites may look "official" and sound real, but they are actually scams or just plain rip-offs. Often they will start asking for your personal financial information, such as Social Security number and bank account numbers, while making ridiculous promises and unreasonable requests, like:

  • Millions of dollars in aid go unclaimed every year; don't you want some of that money?
  • I just need your credit card or bank account number to hold this scholarship.
  • You've been selected by a "national foundation" to receive a scholarship!
  • The scholarship is guaranteed or your money back!
  • We'll do all the work!
  • Buy now or miss this opportunity!
  • You can't get this information anywhere else!
  • The scholarship will cost some money...

Do any of those sound familiar? Follow these tips to avoid scholarship scams:

  1. Learn to recognize the warning signs - if it sounds too good to be true, it probably is!
  2. Check the organization's reputation by contacting the Division of Consumer Services, your school's guidance counselor, the local library, look for blogs about the business on the internet.
  3. Contact the Office of Financial Aid at the school or university you are interested in attending. They can provide relevant information regarding availability and eligibility requirements for grants, loans, and scholarships.
  4. Check out the company and its offer thoroughly, BEFORE giving them any confidential information about yourself. Call the Division of Consumer Services at 1-800-HELP-FLA (435-7352) to check their complaint history.
  5. Don't give in to high-pressure sales tactics. Be suspicious of any company that insists you make a quick decision because the offer is "time limited."

Before you decide or make any commitment to use a financial aid advice service, you should investigate the organization yourself:

  1. Do a little research, most of the information these "opportunities" offer for a fee is actually available to you for free. Of course they won't tell you that because they want you to pay them for the information. Ask your local college or university for free resources that are available.
  2. Use an Internet search engine and enter the name along with the word "scam" - also do some research using their web address. If reputable sources identify it as a scam or illegal activity, it would be wise to look elsewhere!
  3. Ask for names of three or four local families who have used its services recently. Then call those people and ask questions.
  4. Ask how many students have used the service and how many of them received scholarships or grants as a result.
  5. Find out about the service's refund policy, get everything in writing and read all the fine print before signing anything!

Keep in mind, though, that a company charging for financial aid advice is not committing fraud unless it doesn't deliver what it promises. For more information about financial aid fraud or to report fraud, call the Federal Trade Commission toll free at 1-877-FTC-HELP (382-4357).