Finding Safe and Credible Scholarships: A Student's Guide to Avoiding Scams and Fraud

by Imed Bouchrika, Phd

Co-Founder and Chief Data Scientist

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Many students choose where to attend based on what scholarships they secure. For others, financial aid determines whether they pursue further education at all.

Scholarships are an invaluable resource for students combatting the rapidly increasing costs of higher education. They can significantly reduce potential debt and provide opportunities otherwise out of reach.

However, these students are in a vulnerable position. They are desperate to secure as much assistance as possible, pushing them to research non-conventional avenues. This wide-net approach makes them more likely to encounter and believe fraudulent offers.

How Can I Secure a Strong Educational Future?

To build a resilient educational pathway, integrate verified scholarship opportunities with a strategic evaluation of academic and career investments. Assess the credibility of any financial aid offer while comparing the long-term benefits of your chosen field. For instance, aligning your studies with careers that offer lucrative outcomes can be a critical component of your strategy; consider exploring high paying degrees to understand potential returns. Enhance your approach by consulting professional financial and academic advisors who can offer personalized insights on institution quality, market demand, and career counseling, ensuring your educational investment contributes to enduring financial stability.

Understanding Scholarship Scams

It's okay to search for scholarships with favorable requirements or less competition, but students must be on the lookout for red flags. Noticing the signs can prevent consequences like identity theft, financial losses, and significant emotional distress.

Scholarship scams trick students into giving away their financial or personal information. Criminals distribute fake offers or programs through various methods, such as email, social media, or mail.

These scams are often more effective than typical phishing attempts as they provide logical reasons to request fees or applications. Unlike most scams, asking victims for personal information or sending in an initial processing fee doesn't seem out of place.

Two highly effective strategies for crafting a believable attack are built into scholarship scams. They target people in financial desperation and approach from a position of trust and authority. These tactics encourage rash decisions and make it less likely for targets to fact-check the scammer.

There are several types of scholarship scams. Many go undiscovered for years because students assume they weren't chosen for the scholarship instead of questioning the legitimacy of the interaction.

Common Types of Scholarship Scams

Learning how scholarship scams operate allows students to safely pursue financial opportunities without compromising their finances or personal data. Some of the most common types of scholarship scams include:

• Application Fee Scams
• Upfront Fee Scams
• Scholarship Service Scams
• Social Engineering Scams

Application Fee Scams

This type of scam asks students to submit a processing fee alongside their application. Scammers typically ask for small amounts, between $5 to $35, which seems like a paltry price for a scholarship worth hundreds or even thousands of dollars.

A small percentage of the collected fees may be redistributed to a few lucky winners. The scammer can announce the winner and pretend it was a charitable act. This façade adds legitimacy to the "scholarship" and lures future victims.

This approach shares many similarities with pyramid schemes, which use victims' funds to falsify results. However, many scammers don't return a dime to applicants, pocketing all the fees for themselves.

The initial solicitation may include a form or link to a submission page. These forms include fields for information like phone numbers, addresses, or social security numbers. The more obvious ones may request the user's credit card information to "pay the fees electronically."

Criminals can take this information and leverage it into full-blown identity theft. They may also sell it on the black web for a quick profit.

Upfront Fee Scams

At first glance, an upfront fee appears identical to application fees. The main difference is that upfront fee scams make a promise or a scholarship guarantee.

Rather than charging for the honor of being considered, upfront fee scams tell the victim that they've already secured the scholarship. The scammer explains away suspicions with vague language about the selection process.

However, this is where the good news ends.

The scammer says the student must pay release fees to obtain the scholarship, which are described as scholarship taxes. Typically, this is where most people would become suspicious, but the promise of thousands of dollars can cloud anyone's judgment.

Scholarship Service Scams

Some scammers pretend to act as a broker service for scholarships. They charge a fee for connecting students with easy and high-value scholarship opportunities. Most offer a money-back guarantee.

Services like this do exist. All sides of college admissions are lucrative, after all. However, no firm can guarantee a secured scholarship because those decisions are made by independent parties and the applicant's merits.

These scammers take the initial payment and disappear. If they do stick around, it's probably to tie in other scholarship scams and squeeze even more money out of their victims.

Social Engineering Scams

Scholarship offers are a fantastic pretense for phishing scams. Targets open a dangerous link while trusting it came from a friend or reputable source.

This tactic has also latched onto social media. Scammers can immediately tell if the target is the right age for a scholarship scam. They can even use the target's social media page to tailor a more sophisticated pitch.

Social engineering scams start with a direct message from a stranger or an acquaintance's spoofed account. The scammer gushes about an easy scholarship while emphasizing the time-sensitive nature of the opportunity.

Next, the scammer sends a link to a malware-ridden or fake website. Some criminals even create realistic websites designed to trick users into revealing personal information through an account creation or login process.

Red Flags to Watch For

It isn't difficult to recognize a scholarship scam if the target keeps a cool head. That said, scams are based on exploiting emotions that lead to uneducated actions, and scholarship scams are no exception.

These attacks typically target human weaknesses created by things like fear, stress, excitement, or trust. In the moment, these feelings can make an obvious scam seem perfectly reasonable. Take a beat and consider if the scholarship offer matches any of these red flags.

Unsolicited Scholarships

Scholarship opportunities don't come gift-wrapped on your doorstep. They are nearly exclusively the result of contacting an organization or going through an educational advisor. Providers offering scholarships out of the blue must be considered under severe skepticism.

Time-Sensitive Opportunities

Urgency tactics are standard practice in all scams. They force targets to act without considering the risks or doing their due diligence. Scammers may claim there are only a few spots left or that the submission deadline is fast approaching.

Unclear or Nonexistent Criteria

Scholarships are competitive. They have specific qualification standards such as GPA benchmarks or extracurricular achievements. Other scholarships are only available to students of certain genders or ethnicities.

Scammers use vague language so their pitch resonates with a broader demographic. Students must be wary of providers who do not clearly state their expectations for applicants.

Requests for Personal Information

It's normal for scholarship providers to request an applicant's contact information and documents covering test scores, school performance, or achievements. However, applicants must avoid sharing personal information like their Social Security Number or bank account details.

How to Identify Legitimate Scholarships

Many scholarships come from obscure sources, like the Pawsible Puppy Raiser Academic Scholarship or the Protect American River Canyons Essay Contest. These examples are legitimate scholarship opportunities, but they sound like AI-generated word jumbles.

Separating fact from fiction starts with a thorough investigation of the provider. This process can confirm a provider's legitimacy and teach students about the application requirements and expected qualifications.

Researching the Scholarship Provider

"Don't believe everything you read online" is generally good advice. It isn't enough to confirm a supposed scholarship is connected to a website or social media page. Scholarship seekers should examine the provider's website, supposed affiliations, and past awardees.

Review the Provider's Website

A poorly designed website is glaringly apparent. In many amateur scams, the design elements don't fit comfortably on the page or translate well into mobile browsers. The text may have broken links, grammatical errors, and misspellings.

However, some scammers put in the extra time to rip assets from reputable websites and create a convincing spoofed version. These are significantly more challenging to recognize without going through them with a fine comb.

There are a few telltale signs of a fake website that are more difficult to hide, including:

• Incorrect primary domain name
• Lacking "https" SSL security certificate
• Young domain age
• Hidden contact information
• Overreliance on stock images

Contact Professional Partners & Affiliations

Often, scammers will attempt to gain trust by proxy. They list reputable organizations or universities as partners, hoping nobody calls the bluff. These claims are easily confirmed with a quick phone call or email.

Remember to locate the supposed partner's contact information on your terms. Do not click the links to partnered pages from the original website.

Confirm the Scholarship's History

Many scholarships are founded yearly, but most have been around for a while. Scholarship programs are typically proud of past awardees and showcase results like essay submissions or event photos. These records leave a digital trail that students can use to confirm the legitimacy of a scholarship.

Utilize Scholarship Search Tools

There are various online databases for scholarship opportunities. The US Department of Labor partners with Careeronestop.org to provide a list of reputable sources for financial aid. This service is easily searchable with filters for the student's level of education, award type, location, and field of study.

Third-party non-profit services like Scholarships.com and FastWeb also exist. These platforms go a step further and connect users with suitable scholarships based on qualifications and identity.

Are Accelerated Degrees a Viable Path to Professional Success?

Accelerated degree programs offer a condensed curriculum that aligns academic rigor with career readiness, providing a strategic complement to secured scholarships. These programs minimize time-to-degree and often reduce overall educational expenses, which is particularly advantageous when balancing limited financial resources and high industry demands. Students should evaluate program accreditation, curriculum design, and direct outcomes, ensuring that the chosen path meets stringent professional standards. For a closer look at programs that combine efficiency with strong career prospects, consider exploring fast degrees to get.

Is Institutional Accreditation Key to Securing Legitimate Scholarships?

Verifying institutional accreditation is crucial for ensuring that scholarship offers lead to recognized and quality educational programs. Accreditation signals adherence to rigorous academic and operational standards and denotes a credible validation of an institution’s legitimacy. Applicants should independently verify an institution’s accreditation status using reliable sources, which helps in mitigating the risk of fraudulent scholarship offers. Authentic institutions often have transparent affiliations and partnerships that bolster their legitimacy. Leveraging comprehensive resources such as our list of the best accredited non-profit online universities can be an effective strategy for confirming credentials and safeguarding your educational investment.

Conducting a Safe Scholarship Search

Conducting a safe scholarship search is all about recognizing dangerous behavior. Like marketing campaigns, many scams involve pipelines that gradually coax targets into oversharing.

Tips for a Secure Search

Scholarship applicants should stick with dedicated search platforms like CareerOneStop or FastWeb. These platforms vet scholarships for you and ensure all links go to each scholarship's official website.

However, some people may want to perform their own searches. This option is far less secure and requires searchers to protect themselves through personal habits.

The most important rule is to refuse questions about sensitive information whenever possible. Most scholarship applications only require education records and contact information. Financial documentation and social security numbers are reserved for specific scholarship types.

Tax and income records may be required for scholarships based on financial need. The provider must confirm the student's or the parent's income. Applicants should not share financial information if the scholarship does not have this requirement.

Sharing Social Security Numbers is ideally restricted to government aid. FASFA requires the applicant's personal information to track identities.

Applicants should also be wary of signing into unvetted websites. Cybercriminals create fake login pages to lure users into revealing their login credentials. Many people reuse the same username and passwords for multiple accounts, so losing them once may compromise other accounts.

Seeking help from school resources such as a counselor or financial aid office can relieve a stressful situation. Professionals can provide guidance on locating reliable scholarships and help verify opportunities.

Can Short-Term Certifications Enhance My Career Prospects?

Short-term certifications offer a swift alternative for acquiring specialized skills that complement scholarship-funded education. These programs provide a focused curriculum designed to meet current industry demands, enhancing your competitive edge without the commitment of a full degree. When evaluating such opportunities, verify their accreditation, instructor expertise, and industry partnerships to ensure they deliver market-relevant training. For example, consider exploring 6 month certificate programs as a streamlined way to build professional competencies. Integrating these credentials with traditional educational investments can diversify your skill set and potentially accelerate your career trajectory.

Which Affordable Online Colleges Are Credible?

Evaluating affordable online education involves verifying accreditation, faculty qualifications, and institutional transparency. Cross-reference information available on governmental education sites with independent reviews and trust indicators. Additionally, ensure that prospective schools provide clear financial aid processes and support services for FAFSA applicants, such as guidance on applying for loans and scholarships. For example, consider exploring cheap online colleges that accept FAFSA as a starting point to compare cost-effective institutions that meet quality standards.

How Can Third-Party Reviews Validate Scholarship Opportunities?

Leveraging independent reviews and verified testimonials offers an additional layer of validation when evaluating scholarship opportunities. Prospective applicants may cross-reference feedback from credible educational blogs, accreditation bodies, or government databases to confirm provider legitimacy. Analyzing detailed user experiences can clarify factors such as responsiveness, clarity of eligibility criteria, and transparency in fund disbursement. Comparing such insights with established benchmarks—for instance, resources that outline the cheapest associate degree online programs—provides a comprehensive view of value and safety. This approach not only reinforces trust but also aids in distinguishing genuine awards from potentially fraudulent schemes.

What to Do if You Suspect a Scam

If you identify a suspicious scholarship, it's crucial to report it to the proper authorities. While you may not fall victim to this particular scam, you could protect others in a similar situation from financial harm.

The Federal Trade Commission (FTC) recommends reporting these scams to their agency or your State Attorney General. In most states, the Attorney General is responsible for protecting safe consumer practices and tackling deceptive or criminal fraud.

Most people shop for scholarships seasonally, which means there's a finite window to cut down a scam effectively. All states include a Consumer Complaint Form for reporting grievances by email or mail, but it is more expedient to call the Attorney General's Office directly.

The FTC has a streamlined report process that walks people through the steps. It starts by asking for the general category of the fraud before directing users to a text field to describe the scam in greater detail. There is also a section to describe your personal losses.

What to Do if You've Been Scammed

If you have already fallen victim to a scholarship scam, there are several steps you can take to  general category of the fraud. Speed is of the essence since scammers can quickly leverage stolen information.

1. The first step is to contact your bank or credit card company and cancel the transaction. Some banks may refund the money if it already went through due to the Electronic Fund Transfer Act. However, results vary depending on the type of scam, bank policy, and the total losses. The odds of a refund increase the faster you report the transaction.
2. Next, you'll want to protect yourself from identity theft. The most efficient method is to enact a freeze on your credit report. A freeze blocks all access to your credit report, preventing criminals from opening new accounts in your name.
3. This protection is easy to set up. Call one of the three major credit bureaus, and they'll lead you through the process. Each bureau must also enact the freeze with the other bureaus, so you only have to go through the setup process once.
4. You should also change the login credentials and email attached to your current accounts. This step includes bank accounts, social media profiles, professional pages, and other important information sources.
5. Lastly, students relying on fraudulent scholarship money must contact their school's financial aid offices for further guidance. They may have been counting on a "guaranteed" scholarship and not prepared other avenues to cover tuition or living arrangements. 

How to Protect Your Digital Footprint

A few low-effort precautions can significantly reduce your risk of identity theft or account takeover. 

Start by using strong, unique passwords for your accounts. This means keeping them over thirteen characters with a mix of letters, numbers, and symbols.

Although all these complex passwords may sound difficult to navigate, password managers have come a long way. The best managers employ military-grade encryption protocols to protect your accounts and provide a great quality of life by automatically filling in credentials and generating new passwords.

Password managers do have one weakness. They utilize a master password that could give a hacker complete access to all your accounts. Luckily, multi-factor authentication shores up this vulnerability.

MFA asks for confirmation from a connected device like a phone or token. Hackers cannot access your accounts without this physical object. MFA also buys you time to change all your passwords in the unlikely case of a password manager breach.

Lastly, everyone should review their privacy settings on social media accounts. There are many ways to keep your private life private, such as restricting access to your posts to close friends.

Scholarship scams are increasingly common, but you can avoid them by staying informed and vigilant. Always research scholarship providers and stay attentive to red flags like upfront fees or inappropriate information requests.

There are various scholarship databases from the government and third-party platforms. These options can direct students to trustworthy and official scholarship opportunities. Going through the process with your current school's financial aid office is also an option.

Most importantly, don't act on a scholarship offer with a hot head and report scams when you see them. There's a collective responsibility to prevent fraud from harming others in our position. Following these steps, you can confidently pursue genuine scholarships and protect yourself from fraud.