Warning issued for offers of college aid
By Debra Erdley
Published: Monday, Dec. 24, 2012, 12:01 a.m.
Letters and emails guaranteeing scholarships might sound promising to high school seniors contemplating a mountain of college tuition next fall, but experts say the offers could be fraudulent.
Mark Kantrowitz of Cranberry, an author and financial aid expert who publishes the FinAid and FastWeb aid and scholarship websites, estimated hundreds of thousands of students fall prey to these scams every year.
The Federal Trade Commission and the Pennsylvania Higher Education Assistance Agency also advise caution, noting that consumers lose millions of dollars every year in college scholarship and loan scams by paying “application,” “registration” or “processing” fees.
“Most people who are scammed don't even realize they've been scammed. They'll just say ‘Oh, I didn't win the scholarship,' ” Kantrowitz said.
Kantrowitz said new takes on old scams are always cropping up.
“There is one scholarship that gives out 180 $1,000 scholarships, and they charge a $3 application fee. That sounds innocent enough until you hear they received over 100,000 applications. That's $300,000, and they're giving away $180,000. That's a scholarship for profit. They're just recirculating the student's money,” Kantrowitz said.
In another instance, the FTC found that a man accessed large mailing lists and sent out letters advising students they had won a scholarship.
“The letters were saying, ‘Congratulations, you won and all you have to do now is send in a $10 registration fee.'
“He'd have names like USA Biology Scholarship. And the response addresses were mail drops where he'd go around picking up the checks,” Kantrowitz said.
“If you have to pay money to get money, it's a scam. Scholarships are not about getting money; they are about giving money. If there is a processing fee or application fee, it's most likely a scam,” he said.
The FTC warns that any solicitations that include a P.O. box but no street address should raise a red flag.
Pennsylvania Higher Education Assistance Agency officials advise students and families to use Kantrowitz's free FastWeb site to search for scholarships.
Mike Giffin, owner of Ensphere College Planning Services in Upper St. Clair, said it's rare that scholarship money comes looking for students.
“You have to do your homework and remember the best money will always come from the universities,” Giffin said.
He warned against scholarship funds that request the information families provide on the Free Application for Federal Student Aid, or FAFSA, forms.
“If you give them that, you've basically given them the information you provide to apply for a credit card,” Giffin said.
Debra Erdley is a staff writer for Trib Total Media. She can be reached at 412-320-7996or email@example.com.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Firefighters battle blaze at Homer City fuel facility
- Carnegie Mellon University eyes global perspective with new president
- Corbett signs bills on abuse
- Pittsburgh Poison Center warns of krokodil
- Man shot by Pennsylvania state police at Pittsburgh International Airport was key witness in Massachusetts murder trial
- Bob’s Garage not just about the decorations
- Peduto looks to Obama for scaffolding from 550-foot Washington Monument
- Vandalism at South Fayette schools prompts police investigation
- Western Pennsylvania hospitals lag state improvement
- Sentence light in income tax scam