College scammers target resumption of loan payments: Internet Scambusters #1,005
Student loan repayments are due to start again on May 1 (unless there's another pause) and college scammers are ready to cash in.
But the fake debt relief they offer in return for payment is just the tip of a recent surge in con tricks targeting students.
They also face blackmail threats, digital download scams, and even being tricked into taking courses backed by false promises, as we report in this week's issue.
Let's get started…
10 College Scams and How To Beat Them
Students are facing a surge in college scams as the virus relief program that paused loan repayments comes to an end in just a few weeks.
Unless there is a further extension to the program, it will end May 1. Scammers know this and are already cashing in.
They say they can reduce or cancel payments in return for a fee. In a particularly nasty variation, they claim that a non-existent debt forgiveness program will expire within 24 hours, forcing victims into acting fast, without thinking.
This is just one of a stream of new and longstanding college scams that students, often inexperienced in sniffing out a crook, are encountering right now. Others include:
Unpaid Tuition Fees: Students and, often, their parents, are told by a fake college administrator that they're behind with fee payments. Victims are warned they'll either be given a fail for their course or be removed from college altogether.
Fee For Free: Victims are charged up to $1,000 by supposed specialists to apply for Federal Student Aid. But it's free. In fact, the application form is called Free Application for Federal Student Aid (FAFSA).
Honor Society Membership: Most university honor societies do charge a fee for membership, but so do fake and non-existent ones.
Overpayment: This is the common scam in which victims receive and bank a check and are then asked to return a portion of it from their account before the check turns out to be a dud. In the case of students, the money is usually a supposed advance payment for a job.
Blackmail: Students are prime targets for blackmail. Away from home, they often find themselves in situations where they let down their guard on behavior. Or they may be lured into providing compromising photos of themselves.
Digital Downloads: We've reported before on how students can be scammed into buying textbooks online at knockdown prices. (See Colleges and Textbook Publishers Accused of Scamming Students.)
Not only are there no books but the scammers also then get victims' confidential financial information. Now crooks are offering cheap digital downloads of books, with the same aim PLUS uploading malware onto victims' PCs.
Crypto Trading: Most students are permanently hard-pressed for cash. And they know some incredible financial returns are available by trading in cryptocurrencies like Bitcoin. But a lot of people end up losing a fortune. Students are targeted with emails and social media ads. In one case, a scammer claimed they could make $28,000 in just two hours. And because their "investment" is in an untraceable currency, it will never be seen again.
Bogus Achievement Claims: Some for-profit colleges and universities have earned a bad reputation for making claims about their success for students both in gaining passes and finding a job. The US Federal Trade Commission (FTC) has just stepped in by sending out warnings and reviving old rules that enable them to fine institutions that knowingly make false claims.
Phishing: College scammers use all manner of tricks to get students to give up information like student ID numbers and private financial information, like bank account and card numbers. Recently, they've started trying to trick them into revealing their parents' confidential info, including Social Security numbers.
How to Beat the College Scam Artists
There are many more college scams than those we've listed here -- fake jobs, student housing, roommates, romance, and dating for example.
In all cases, the villains target students because they're young and their parents are not around to monitor and guide.
But following these five rules will help you, whether you're student or a parent, avoid most of the fraudsters' tricks:
- If you have student debt problems, go to the official StudentAid.gov website and search for solutions there. If you want to lower repayments, speak to your loan provider. If you want to apply for aid, fill in the free form at Fafsa.gov. If you're told you're in default with tuition payments, speak to your college admin people.
- Always check out the sources of any claims, offers, or payment requests with parents or college authorities. Simply don't take action without discussing it with someone whose opinion you respect.
- Research any organization, whether it be an honor society, a potential employer, a date, a bookseller, a university, or any of the other third parties we've mentioned here. Use the Internet and the good ol' phone book to track down their names, addresses, and reputation. If you can't find them, don't deal with them.
- Beware of bargains and supposed easy money. They generally don't exist or there's a costly catch. Generally, never spend money to get money -- whether it's for a job or an investment program -- without speaking to an expert.
- Remember that anything you do, almost anywhere (including the Internet) is in the public domain where people lurk with cameras. Don't do anything you don't want the world to know about. If you receive a blackmail or security threat, speak to police and college authorities.
Above all, as cranky and old-fashioned as it seems, parental advice is often the best source of guidance against student fraud. Both students and parents need to establish a good relationship of trust with each other in order to avoid these deadly college scams.
This Week's Scam Alert
Cloud security firm Lookout has published a new list of the 20 most often used passwords -- the ones that scammers almost certainly try first when they're out to crack accounts with stolen identities.
In order, they are: 123456, 123456789, Qwerty, Password, 12345, 12345678, 111111, 1234567, 123123, Qwerty123, 1q2w3e, 1234567890, DEFAULT, 0, Abc123, 654321, 123321, Qwertyuiop, Iloveyou and 666666.
If you use these or any similar passwords, change them now.
That's all for today -- we'll see you next week.