Finance Security

How Scammers Use Phishing Emails to Target Students

Lori Cline 01-12-2016

When an email promises a free government grant or a scholarship award, it can mean the difference between success and failure for many students. Thankfully there are rules you can follow to keep you from being a victim of a student financial aid scam.


Student-Targeted Email Scams

In Las Vegas, a graduate with multiple student loans received an email, instructing them to:

Call the number below to take advantage of the President’s new plan to help students who are no longer in school but still have student debt.

At the University of Montana, students in need of financial aid received this message:

The University of Montana Fund Committee is charged with disbursing funds to all students and staff. Attached is a payment form for account identification to receive funds through this email.

At a southern California school, Freshman students received this in a phishing email How to Spot a Phishing Email Catching a phishing email is tough! Scammers pose as PayPal or Amazon, trying to steal your password and credit card information, are their deception is almost perfect. We show you how to spot the fraud. Read More :

Congratulations! You are one of five finalists that qualified for the National Scholars Alumni Foundation Scholarship.

Sounds good, right? Except none of the claims are true; they are all examples of the latest financial aid email scams How To Deal with Spam and Report Email Scams in The U.S. Read More targeting today’s students, both current and unenrolled.

Students have not been educated (no pun intended) as to the ways the scam is played out. Because these offers are quite tempting, they are tricked into acting on them. College is super expensive and students tend to jump at the chance of money being given away and the misguided assumption that they are getting something for nothing.


Grants and Scholarships

In London, a student was scammed out of £300 (roughly $375 USD) due to an email she received from what looked like her school’s financial aid department (it even had the university logo). The email offered her a grant and asked for her checking account number, which she provided. By the time she realized she had been scammed and got to her account, the money was gone.

Image Credit: Gunnar Pippe via

This scheme is used quite often. False free government grants are popping up more and more, offering free money in exchange for a student’s banking details.

Meanwhile, false scholarship awards are also offered to dupe you into parting with your money. You will open your inbox and find that you’re a finalist for scholarship you never applied for. Red flag: If you are awarded a scholarship, you will be notified by snail mail, not by email or a phone call.


Fast Web is one of many web sites that direct students to real scholarships. Ask your school’s financial aid department for a list of scholarships to research, there are many sources of scholarships to which you can apply.

The rules to follow: Never give any personal financial information 10 Pieces of Information That Are Used to Steal Your Identity Identity theft can be costly. Here are the 10 pieces of information you need to protect so your identity isn't stolen. Read More  any personal financial information, banking or otherwise, to anyone. If someone is asking for them, it’s a scam. And always check the organization that is awarding the scholarship. If it doesn’t exist or you have never applied, you’ve been scammed.

Debt Consolidation/Loan Forgiveness

Image Credit: Welf Aaron via
Image Credit: Welf Aaron via

The Federal Student Aid website allows you to look up your loan status and offers advice on what you can do with your student loan if you’ve defaulted; they also list options for consolidating multiple student loans. Remember, you always have to repay a student loan, unless you qualify for a reason the Department of Education deems federally appropriate, such as a permanent disability.


The Better Business Bureau has posted a scam alert to warn the public about this scam and gives you tips on how to spot the fraudulent email and what to do if you receive one.

The rule to follow: If you have student loans and receive one of these offers, contact your lender directly. A promise to have your loan wiped out is a scam.

The Federal Student Tax


Image credit: dizain via
Image credit: dizain via


One of the latest scams plaguing students is the “Federal Student Tax”. It is perpetrated by email or phone Don't be a Victim of These Common Phishing Attacks Read More and urges students to pay the tax as soon as possible and looks exactly like IRS communication.

There is no “Federal Student Tax”.  However, an IRS warning is alarming enough to accept without accreditation. The scam is perpetrated by demanding a credit or debit card number by phone to satisfy the debt. The IRS issued a warning that details the tactics used to scam students into giving away their money.

Fake Seminars and Websites


There are many seminars, websites, and even law firms that will offer to take all the work out of getting the financial aid you need for a fee. If you are offered such help and they want your money, it’s a scam. These tricks often take the form of a newspaper, television or online ad — don’t believe it.

Image credit: via
Image credit: via

You can apply for financial aid yourself and not pay anybody anything; only you and/or your parents know the correct information to give so as to receive the right type of student financial aid. The only thing you need to begin your search for student aid is the FAFSA (Free Application for Student Aid) and it’s just what it says it is. Free.

One thing to note: it really doesn’t matter if the place that wants to help you is legitimate. The organization may even exist, but once the fee is paid you will have a hard time getting any kind of help with anything.

In this case, there is a very clear rule to follow: Never pay a fee to anyone that offers to “do the work for you” so that you can get the financial aid you need. If you are asked to pay for help with applications for financial aid, it’s a scam.

Cybercriminals Will Make You a Victim

Cybercriminals What Exactly Is Phishing & What Techniques Are Scammers Using? I’ve never been a fan of fishing, myself. This is mostly because of an early expedition where my cousin managed to catch two fish while I caught zip. Similar to real-life fishing, phishing scams aren’t... Read More do not discriminate, and student aid scams are simply another fraudulent way for them to get money. If you do fall victim to one of these schemes, make sure you report them to the right authority, such as Better Business Bureau (BBB) or the Internal Revenue Service (IRS).

When you are looking for financial aid, the bottom line is this: Any financial aid get will come from the work you do to receive it, not money you pay anyone. As with anything else, if an offer is too good to be true, it probably is.

Do you know anyone who has received an offer for “free money”? Was it a scam? Perhaps you know someone who responded to one of these cybercriminals or worse, been scammed yourself. If so, do tell! Your input may even prevent someone from being a victim to a scam that is just downright sad.

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