Beware of Student Loan Forgiveness Scams

October 31, 2022

by Christian Phillips

Current and former college students not only have the challenge of repaying student loan debt but now have to avoid cybercriminals attempting to take advantage of the legitimate student loan forgiveness program.

How Does the Scam Work?
Like other online scam attempts, cybercriminals will contact consumers via social media, text, phone calls, or emails and promise immediate debt relief. Once the cybercriminal has access to your account information, the following details might be compromised; name, date of birth, social security number, and associated addresses. Cybercriminals also corrupt consumer information by requesting payments for fraudulent applications.
*The previously live application on the Federal Student Aid website is free, do not pay to apply.

How to Identify Loan Scams:
Cybercriminals will create fake websites to mislead consumers, referred to as “website spoofing.”
[Definition]
  • What is website spoofing? Website spoofing is the process of replicating legitimate sources to mislead the consumer.
Before clicking or providing additional account information, try identifying irregularities with the website. For example, does the webpage include the lock icon (encryption), is the domain name modified, and are there overt spelling and grammar errors? If yes, that is a good indication that the website is fake. Here is an example of an altered domain name that is easily overlooked. https://studentaid.gov could be changed to https://studenta1d.g0v. 
The U.S. Department of Education will not advertise student loan forgiveness via email, phone, or text. All of the required information will be on the Federal Student Aid Website.  

Things to Avoid:
Do not open file attachments sent via email or text from sources advertising immediate debt relief. The extensions could include malware or ransomware intended to corrupt personal information. In addition, think before you click on unknown external links. Copy and paste the external link into Google Safe Browsing. This free service will help you identify harmful sites. 

What if I was scammed?
Did you provide information that may compromise your federal student aid account? Contact the federal loan servicers assigned to your account. The loan servicer can help indicate whether unauthorized actions were taken on the account.

[Final Thoughts]
Furthermore, if you paid fraudulent application fees, contact your bank’s fraud department or credit card company to report the issue. The U.S. Department of Education recommends submitting reports of scams on the Federal Student Aid website. 

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