Beware of Student Loan Forgiveness Scams: Given the considerable financial strain that many individuals are under due to their student loan debt, it is unsurprising that an abundance of fraudulent schemes claiming absolution on student loans have surfaced, with borrowers desperately seeking relief. Annually, notwithstanding the Federal Trade Commission’s (FTC) endeavors to combat these schemes, new fraudulent organizations emerge.
As a result of President Joe Biden’s recent announcement concerning student loan forgiveness, this issue has become even more urgent. Borrowers must maintain a state of constant vigilance and be on the lookout for indicators that may indicate impending schemes as they navigate these intricate environments.
Tips to Identify and Avoid Student Loan Forgiveness Scams
Methods by which con artists approach you
Scammers specializing in student loans may employ daring communication techniques. There are several to be wary of.
Robocalls occur.
If your phone rings with an unknown number, you should reconsider. Scammers placed over 350,000 student loan-related robocalls during the first half of September, according to Transaction Network Services, a provider of financial infrastructure.
“Be wary of unsolicited communications or phone calls,” advises Armeson. “That is the most likely method by which a con artist intrudes upon your life.”
Mail snails
Con artists may also send letters via the mail. Read them thoroughly. Scam letters frequently contain grammatical or typographical errors, even if they appear official or formal, according to the Education Department.
Communication via text and social media
Tayne states that scammers are increasingly targeting consumers via social media and text messages. The FTC reported earlier this month that social media scams have caused $2.7 billion in reported losses since 2021, more than any other contact method.
Text messages addressed to the Education Department from any source will be identified as 227722 or 51592.
Electronic mail
Scammers might attempt to gain access to your inbox. If an email’s sender appears dubious, verify it further.
Legitimate Education Department emails will exclusively originate from the following senders:
Preventing instances of student loan fraud
If you unexpectedly receive a phone call regarding your student loans, do not answer. Immediately terminate the call if it is not a robocall; if a person is speaking on the other end, hang up.
“If someone claims to be from a particular agency, department, or loan servicer, simply respond, ‘You know what, I’ll do my research and get back to you on my own,'” advises Armeson.
Clicking on any links in an email or text message regarding your student loans is not advised.
LiaBraaten recommends that you protect all of your online financial accounts, including StudentAid.Gov and student loan servicer accounts, with robust passwords and two-factor authentication enabled. Share your login information at all times. Scammers can alter your federal student loan account and electronically sign legally binding student loan documents using only your username and password.
Your service provider and the Education Department will never request your password.
What to do if you are a victim of student loan fraud
If you suspect that you are the target of a scammer, cease all communication with them promptly. Then, proceed as follows to seek assistance and safeguard yourself against further harm:
Contact the servicer of your student loans. Inform your servicer of the situation by calling them. Inquire about the status of your loan and whether the impostor accessed your account.
Contact your credit card and bank. Request that all remittances to the scammer be halted.
Login with a new password. Passwords for all financial and student loan accounts, including StudentAid.gov and servicer accounts, should be updated.
Keeping an eye on your finances. Verify that no unauthorized account or credit line has been established in your name. Weekly credit reports are available for free at AnnualCreditReport.com.
Consider instituting a credit freeze. Freeze your credit if you suspect the fraudster may have sensitive data, such as your Social Security number, to protect against identity theft and fraud.
Preserve all records of communication. Save these records if the fraudster contacts you via text message or email; the FTC and other law enforcement agencies may require this information.
The Federal Trade Commission (FTC) may use reports of potential schemes to identify trends, educate the public, and prosecute fraudsters in collaboration with over 2,800 law enforcement agencies.
Additionally, if fraudsters have stolen your funds, the FTC will guide how to recover them. “The FTC website states, ‘The quicker you act, the greater your chance of receiving your money back.'”
For additional assistance and investigation, you may also notify the attorney general of your state or the Consumer Financial Protection Bureau regarding the student loan fraud.
Beware of Student Loan Forgiveness Email Scams: Tips to Identify and Prevent Fraud
