Students Getting Stung Trying to Find $$$ for College
With tuition bills skyrocketing, and room and board
going through the roof, students and their families are
looking for creative ways to finance a college education.
Unfortunately, in their efforts to pay the bills, many of
them are falling prey to scholarship scams.
According to the Federal Trade Commission,
unscrupulous companies guarantee or promise scholarships
or grants. Some guarantee that they can get scholarships
on behalf of students or award them
“scholarships” in exchange for an advance fee.
Most offer a “money back guarantee”— but
attach conditions that make it impossible to get the
refund. Others provide nothing for the student's advance
fee — not even a list of potential sources; and
still others tell students they've been selected as
“finalists” for awards that require an up-front
fee. Sometimes, these companies ask for a student's
checking account to “confirm eligibility,” then
debit the account without the student's consent.
The FTC cautions students to look and listen for these
tell-tale lines:
- “The scholarship is guaranteed or your money
back.”
- “You can't get this information anywhere
else.”
- “I just need your credit card or bank
account number to hold this scholarship.”
- “We'll do all the work.”
- “The scholarship will cost some money.”
- “You've been selected" by a 'national
foundation' to receive a scholarship — or
“You're a finalist” in a contest you
never entered.
The FTC says many legitimate companies advertise that
they can get students access to lists of scholar ships in
exchange for an advance fee. Others charge an advance fee
to compare a student's profile with a database of
scholarship opportunities and provide a list of awards
for which a student may qualify. And, there are
scholarship search engines on the World Wide Web. The
difference: Legitimate companies never guarantee or
promise scholarships or grants.
For more information on scholarship fraud, contact the
FTC. To find out how to
finance a college education, contact Sallie Mae. For
information about spotting, stopping, or reporting a
scam, contact the National
Fraud Information Center at 1.800.876.7060.
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