Avoiding Scholarship Scams

These are scams that target those seeking assistance with regard to higher education. Scholarship scammers set up agencies that claim to “specialize” in getting prospective students full or partial financial aid. Scammers use a variety of means to seek out their targets, from in-person seminars to targeted social media posts and advertisements. Such scammers use a variety of methods to fleece their victims, here are a few:

Scholarship Search Service. In this method, scammers promise to find the best-fit scholarship for a fee and if they do not, you are guaranteed a refund. But as soon as they receive the fee, they disappear. In other cases, they might send you a bogus list of matching scholarships, but their policy is stated in such a way that no one can get a refund.

Non-Existent Scholarships. Scammers will claim to have found a scholarship for you, but you need to send some money for application or processing. But, the scholarship does not exist, and in the end, they might claim that the scholarship was later canceled, or you did not qualify.

Financial Aid Lotteries. In essence, this is what these types of scholarships scams are, though the scammers never make this known. How this scam works is that the scammers through their dubious agency will advertise a scholarship of $2000. The take application and processing fees of $50 from say, one thousand applicants. The scammers would make $50,000 and give the scholarship to three candidates making a net profit of $44,000. The odds of winning in this scenario are like winning in a lottery.

The Scholarship Prize. You get an email or a message saying you have won a scholarship or have been approved for an educational grant. Of course, the catch here is you need to pay disbursement or redemption fees.

The Seminar Scam. Most legitimate scholarships do not require you to attend any physical event to apply in contrast to seminar scams which asks that you attend a seminar or information session. In the seminar you will receive a sales pitch from a trained sales consultant on why you need to pay for their service to take advantage of the scholarship opportunity they are presenting. Their aim is to take advantage of you.

Steps for Protection

  • Never pay money to apply or receive a scholarship. If you are being asked to pay for application or processing fees, know that you are dealing with a scam.
  • Never give out financial information like card and account numbers, if you are being asked for this, you are dealing with a scam.
  • If you have been invited to a scholarship seminar, make sure you do a thorough investigation about the agency or organization. Also, never pay money for anything at the venue of the seminar.
  • Keep track of the scholarships you have applied for, and if you receive a message that you have been selected for a scholarship you did not apply for, do not respond.
  • Scholarships are not hidden; with a little effort you can find out all the information you need on your own. This is better than letting agents or agencies handle things for you as they might turn out to be a scam.
  • Legitimate scholarships have eligibility criteria, any scholarship that is all encompassing with little, or no requirements is a scam.

To find out more about other types of scams and the ways you can protect yourself and your loved ones, read our book of scams.

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