As high school seniors and college students apply for scholarships and financial aid, scammers are ready to take advantage of the opportunity to steal sensitive information in the process. 
 
Fall is the prime time for scholarship applications and related scams. According to the Federal Trade Commission (FTC), scholarship and financial aid scammers may contact a student through email, mail or social media telling the student they have been selected for a certain scholarship or financial aid package. Additionally, they may include a call-back number or invite you to a “workshop” to pressure you into paying for their services, convincing you you’ll miss out on exclusive scholarships or aid packages.
 
Financial aid scammers often offer to fill out the Free Application for Federal Student Aid paperwork for you, claiming they can help you qualify for various forms of financial relief with a processing cost. The FAFSA application is free, and the scammer may be falsely filling out your family’s income, benefits and assets to qualify you for more aid. According to Federal Student Aid, fraudulent or misleading information on the FAFSA can lead to a $20,000 fine, imprisonment or both.
 
Keep this advice from Iowa State Bank in mind when applying for scholarships and financial aid:
  • Don’t apply if they request an application fee – Scammers falsifying scholarships that require an “application fee” or “redemption fee” are trying to steal your financial information. Generally, scholarship applications are free.
  • Don’t reply if you never applied – Some scammers will contact you saying you’re a “finalist” for a scholarship and ask for account information to confirm your eligibility.
  • Apply for scholarships from reputable sources – School guidance counselors and financial aid advisors will help students find legitimate applications.
  • Be cautious about attending scholarship workshops – Scammers want to pressure you into attending a scholarship “workshop” or “seminar” promising a scholarship if you pay the course fee.
  • Fill out the free FAFSA application yourself – A scammer wants you to pay them a fee to “process” or fill out your application, claiming they can qualify you for more aid.
As always, if you suspect fraud, contact your personal banker at your local Iowa State Bank office.

This information is provided as a courtesy from the Iowa Bankers Association in partnership with Iowa State Bank.