FDIC-Insured - Backed by the full faith and credit of the U.S. GovernmentFinding a college, moving into a dorm, making new friends, and diving into student life is enough to worry about. Life as a college student can be an exciting time but money is typically tight, and fraudsters know this! Fast cash promises, financial payment pressures, and jobs scams are just a few of the forms of fraud students can face.
Financial and Scholarship Aid Scams
Your inbox dings with a notification, or an unexpected letter has arrived in your mailbox. It’s an invitation saying you’ve been selected for a specified scholarship or financial aid package. On it, a call back number is provided along with a location of where to attend an in-person workshop. When you call or attend, you will be pressured to pay for service immediately or lose out on the opportunity. These are high-pressure sales tactics and it’s a scam.
These companies will “promise” to make you eligible for aid, including grants, loans, work-study programs or other aid types and require a processing fee for handling the paperwork. In actuality, they are filling out the Free Application for Federal Student Aid (FAFSA). There have been instances of these companies falsifying your FAFSA information to make you eligible for student aid, an act that can include fines up to $20,000 and/or jail time. No company will require payment, fill out your FAFSA information or say you have been selected. These are all indictors of a scam. Only you and your family can complete your FAFSA. Be sure to never share the username and password associated with your FAFSA (or any personal or financial account).
Scholarship aid can be quite impactful on a college student’s education journey. Scammers know this and use it as a tactic to steal money from you. If you are being asked to provide payment to apply for a scholarship or are told you are the finalist for a scholarship you never applied to, that’s a scam. If you are being asked for a “processing cost”, “redemption fee”, or any other upfront payment, do not give your payment information. Be wary of any “money back guarantees” as often times, the attached conditions make it impossible to get a refund.
When it comes to financial aid and scholarships, legitimate companies never guarantee or promise aid. Visit the FTC for a deeper dive into Financial Aid and Scholarship scams.
Money Laundering Scams
Studying at school while making an income can be challenging. A virtual job can be very enticing as it gives flexibility around class schedules and requires no commute. However, if an employer mails your first paycheck before your start date, let that be the first red flag.
Scammers post fake listings, for jobs like personal assistants or dog walkers, on social media and frequently trafficked job sites. Upon applying, they will mail you a check to deposit in your bank account and then persuade you to send a portion of it to another account. The check is fake and will eventually bounce, leaving you with a financial loss and the scammer walks away. Avoid a job scam by doing the following:
- Look up the company or person online.
- Additional tip: add the words “scam”, “review” or “complaint” after the company or person’s name. See what the dialogue is online.
- Reach out directly to confirm they are actually looking to hire someone.
- Get it in writing. Ask for a copy of your pay, job description, and other related paperwork.
- Talk with someone you trust and see what they think about it. If others share your concerns, look more deeply into the company before proceeding.
The approach used in the above job scams is similar to how fraudsters approach fake check scams with college students. Scammers may pose as a professor, use a college domain email address, and offer a part-time job such as a “personal assistant” or “dog walker”. They will send you a check and ask that you deposit it, before sending a portion of the money to someone else to purchase gift cards and/or money orders, and the student can keep the rest. What seems like a fast and easy way to earn quick money is actually a scam. When a bank realizes the check is a fake, deductions equating to the original check amount will be taken from the student’s account. Remember, just because a check cleared does not mean it’s a good check.
If these situations happen to you, make sure to report it to the FTC and where applicable, your financial institution. These reports help law enforcement partners support investigations and prevent fraud from occurring.
