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Seen On CBS 2: How To Avoid Scholarship Scams

Expert: Never, Ever Give Out Bank Account, Credit Card Or Social Security Info
College Money Matters (credit: CBS 2)

College Money Matters (credit: CBS 2)

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NEW YORK (CBSNewYork) — They are scams that cost the public millions of dollars a year. Companies are preying on parents and students, tricking them into thinking there’s an easy way to pay tuition.

As CBS 2’s Amy Dardashtian reported Tuesday, there are ways to spot a scholarship scam.

The language in the letters screams scam.

For example: “The scholarship will cost some money”; it is “guaranteed or your money back,” but give us “your credit card or bank account number to hold this scholarship.”

But scholarship scams aren’t always obvious to hopeful parents struggling to find the cash for college.

“You feel really stupid,” said Dr. Abul Kashem, who got sucked into a scam a few years ago. “They had a very good presentation.”

He said a company called College Money Matters lured him and his nephew to a packed seminar.

“I paid almost $850, in that range, to get their help,” Dr. Kashem said.

But later, when he called, the number was disconnected.

“They get the payment and everything, [and] just disappeared,” he said.

Financial aid experts said hundreds of thousands of people a year fall victim to scholarship scams.

“They also will send you things online or in the mail, again, saying we have information on scholarships that no one else knows about,” said Walter Brewster of the Better Business Bureau.

Some imitate government agencies with phrases like “you have been selected by a national foundation to receive a scholarship.”

“Never give anybody your information about your bank account or your credit card or your Social Security number,” Brewster said.

The only real way to find out if you are eligible for government assistance is to fill out a form, the Free Application for Federal Student Aid, because no legitimate company will ever promise or guarantee you a scholarship or charge you a fee.

“Carefully scrutinize any agencies about their promises before paying any money,” Dr. Kashem said.

There are many opportunities to qualify for legitimate private scholarships and grants. For more information, please check out the following link:

FinAid

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