Guarding the Nest: Protect College Students from Fraud and Scams

College is supposed to be a time of growth, learning and opportunity. But for some unsuspecting students and their families, it can also be a time of falling victim to college fraud scams. From checking fraud to identity theft, these scams can be devastating. Here are some of the most common scams college students may run into.

Scams That Target College Students

Fake Credit Cards

The credit card world is filled with scams. College students, being new to the credit game, are particularly susceptible. Be wary of signing up for credit cards from issuers you're not familiar with – and not only credit cards, but prepaid debit cards as well. You risk the chance of relaying information to a phony lender and potential identity thieves. Even if the card is available and functioning, you need to be exceedingly cautious about hidden fees and unreasonable rates. If you see an APR of 25% or more, or an annual fee of $30 or more, you should be concerned.

Check Cashing

In this scam, a "friend" asks you to cash a check for them - and might even offer to let you keep some of the cash for the trouble. Once the check is deposited, it bounces and you’re out both the money and a returned check fee.

Financial Aid Fees

You should never have to pay for financial aid applications or services. There's nothing a company can do for you regarding student loan debt that you can't do yourself for free. If you pay upfront to reduce or get rid of your student loan debt, you might not get any help - or your money back. Remember, the Department of Education will never charge for financial aid help. Reputable scholarship organizations will never require an up-front fee or processing cost, will never guarantee or promise scholarship funding up-front and will never ask you for your credit card or bank account information.

Federal Student Aid ID Access

Never give out your Federal Student Aid ID or other personal information to anyone who contacts you. Fraudsters posing as student loan servicers can use this information to log into your account, change your contact information and even divert your payments to them. Instead of giving out your FSA ID, call or contact your loan servicer.

Spear Phishing

Emails are sent to student employees that appear to be from the college. The email contains a link and claims some type of issue has risen requiring them to enter their login credentials. Once you provide your username and password, the perpetrator accesses the university's computer system to redirect your payroll allocation to another bank account. Compared to phishing emails, spear phishing scams are highly targeted attacks that are very personalized to the intended victim. Never provide personal information in response to unsolicited communication.

Check Fraud

Fraudsters post online advertisements soliciting students for administrative positions. The "company" sends a check to you, the "assistant, " in which you are responsible for taking your "salary" out of the check and wiring the remainder of the money back to the "company." These checks are fraudulent and can leave you out thousands of dollars and facing criminal charges.

Mystery Shopping

Students receive emails or promotions from a website where you can register to become a secret shopper. Once signed up, you’re then told you must pay a fee for more program information to continue the application process. Never pay money upfront for a job. Legitimate job offers will not require any kind of payment.

Identify Theft

For a fraudster to steal a college student's identity, they must first obtain the necessary information which allows them to "become" a college student in the eyes of financial companies. How easy this task is depends on how vigilant you are about protecting your personal information. Here are some common ways a fraudster can steal your identity.

Pre-Approved Credit Offers in the Mail

The mass-mailed forms, usually partially filled out with your information such as name, address and other personal data is a great opportunity to steal an identity. If you’re not interested in the offer and throw away the form, the thief can fill in the rest of the blanks and send it in or call the toll-free phone number provided on the form, allowing them near instant access to one aspect of your identity. It’s best to shred these offers before tossing them away.

Social Security Number Access

Another danger is your Social Security number. Some colleges require you to use your Social Security number to log in to websites used to post homework assignments or as an identifying number with the administration office. Exercise caution when using a Social Security number. If the university uses your Social Security number as your identification, it’s worth asking if you could use an alternate number.

Stealing Your Identification

Of course, one of the most common ways to steal someone's identity is stealing a wallet, purse or backpack. This can even occur in your dorm room or apartment, particularly if parties or unfamiliar guests are common. Exercise the same security at home as in any unfamiliar environment.

How Students Can Protect Against Identity Theft

Use Password Protection

Adjust your computer settings to prompt for a password anytime the computer is used. Change your password from time to time.

Don't Reveal Too Much

Social networking sites may ask for your birth date, but birth dates are a boon to identity thieves. Likewise, do not reveal any other personal info on public sites, or in response to any email requests for your Social Security number, credit card numbers or other data, even if it's from a familiar-sounding company. For example, if you receive an email that says it's PayPal and wants to verify your credit card number, call PayPal directly from the number listed on its website - NOT from any information in that email. If you simply send your credit card number in response to that email, you could find yourself stuck with a maxed-out credit card and negative credit report problems.

Use a Multi-Layered Security Approach

Consider software that provides permanent tagging, GPS tracking, covert data recovery, remote data deletion, stolen property tracing and property registration.

Start Shredding

Search and preview your personal data including credit card numbers, Social Security number, birth date, tax returns and financial aid documents on your computer. Then digitally shred, encrypt or redact that information, depending on your needs. You can often find free digital shredder software online.

If you have any questions or concerns about fraud, CommunityAmerica is here to help. Stay informed, cautious and know we are always ready to assist you in protecting your financial well-being.