Scholarship Scams: Red Flags

Every year tons of soon to be college students begin their search for scholarships for college. Scholarships are a great way to help fund a college education, because unlike student loans, they never have to be repaid. However, among all of the legitimate scholarships out there, there are also scholarship scams and scammers looking to steal money or identities. When applying for college scholarships, there are some “red flags” to be aware of that can help students to avoid scholarships that may be scams, and help ensure that the college scholarships they are applying for are legitimate.

1. A scholarship could potentially be a scam if the college scholarship asks for money or requires you send them money up front. Never pay money for college scholarships. Many times scholarships that are scams will ask for the student to provide some sort of payment in the form of a “fee”. Legitimate college scholarship organizations will never require a student to provide payment in order to be considered for college funds.

2. Students are encouraged to do their research on every scholarship they apply for. Most scholarship organizations are legitimate, however where there is an opportunity to make money, there will be those willing to scam. Just because a scholarship organization sounds official, doesn’t mean it is. Creating organizations that contain words like “national”, “foundation”, or “federal” in the name is an easy way for scammers to gain trust.

3. Take the time to research any and all scholarship organizations that contact you by phone, and organizations offering deals that sound too good to be true. If you receive information from an organization saying you have won a contest that you never entered, it’s probably a scam. You have to apply for all legitimate scholarships; they are not awarded at random.

4. Never Give Personal Information: Some personal information may be required on certain legitimate scholarship offers; however it should raise a red flag if the scholarship you are applying for is requiring you to divulge bank account numbers, credit card numbers or other very personal information. Legitimate scholarships do not require you to pay money up front, or require any type of personal financial information from you (such as credit card numbers, etc…). If a scholarship organization asks for this kind of personal data, beware that it may be a scam. There may be certain situations where scholarships that award based on income needs, may require verification of your income class or status, but even in these types of scholarship situations they will never ask you for a credit card number or banking information. Scholarships are generally going to require basic information (name, address, etc…), as well as information about your grades, achievements, and other scholastic related information.

5. Make sure the company sponsoring the scholarship has a website and a listed telephone number. Most legitimate scholarship organizations should (typically) have both. Students should always utilize the help of high school guidance counselors, and/or financial aid administrators as resources to run any questionable scholarship opportunities by.

Lastly, keep in mind that scholarships are trying give you money for college, they are not trying to collect any money form you, and if they appear to being doing that, then chances are it’s a scam and not a legitimate scholarship.