What College Students Need to Know about Identity Theft
More and more scammers are targeting college students. Here are a few common scams to avoid.
With the dramatic rise in college admissions (the number of students enrolled in U.S. colleges increased more than 156 percent between 1970 and 2020), college education has become a major milestone for young adults. Although the advent of the internet and remote learning courses have moved the university experience online for some, a college degree is still a prized commodity (and a prerequisite for many careers).
Unfortunately, fraudsters are well aware of this growing demographic and subsequently are developing scams to target college students and recent college graduates. So how can students steer clear of potential scammers?
What puts you at risk?
College students and recent graduates are targeted by scammers for a variety of reasons:
- Young adults are often inexperienced with matters related to their credit.
- Students may be navigating their own financial decisions for the first time, applying for credit cards, securing housing, etc.
- Students may be attempting to settle existing student loan debt.
- Students may be actively seeking scholarships or financial aid to supplement school fees.
So, how do scammers target students specifically?
Student Loan Scams
With more than 43 million Americans carrying outstanding federal student loans, it’s a no-brainer for fraudsters to create student loan scams to steal personal information from students. In the same vein as health care fraud, scammers will reach out by email or phone pretending to represent a legitimate organization (most often a college or a debt collection agency) asking students to confirm personal details like their Social Security number, bank routing information, or Federal Student Aid ID (the username and password on the loan account). Though the scammer may claim to be setting up a payment plan for any outstanding student loans, they really use this personal information to steal the student’s identity or commit fraud, taking out loans, opening new credit cards, etc. in their name.
Alternatively, the scammer may claim to be a debt relief expert offering access to instant loan forgiveness options. While student loan forgiveness options do exist, they often take months to get approved. If the supposed debt relief expert asks for upfront payment before they begin settling or reducing your student loan debt, which has been illegal since 2010, it’s almost certainly a scam.
Other Scams to Look Out For
In addition to student loan scams, fraudsters also target students with scams related to:
- Textbooks: Avoid shady online offers and purchase books in person or through your school’s official website whenever possible. Secondhand is still an option here, as other students are often looking to sell their used books (usually for a steep discount).
- Housing: Scammers love to tempt students with inexpensive housing options, relying on the fact that most out-of-area students may have to secure their housing sight unseen. To avoid being defrauded, be wary of subletting (unless it has been approved in writing by the landlord). Stick with reputable landlords and housing companies, especially when securing accommodations remotely.
- Moving: The scammer will advertise their “moving company” with unusually low rates but ask for full payment up front. Once the student makes the payment, the scammer disappears—and so does the money. Only hire reputable moving companies, and when in doubt, ask your student advisor for recommendations.