Home > Financial Aid > Financial Aid Tips > Protecting Yourself Against Scholarship Scams

Protecting Yourself Against Scholarship Scams

Unfortunately, scholarship scams always look like legitimate scholarship opportunities. Individuals and organizations suspected of perpetuating scholarship scams are held accountable under the Scholarship Fraud Prevention Act of 2000 and convictions carry stiff financial penalties as well as jail time.

ADVERTISEMENT

Although scholarship scams are illegal, they are common. Scams are so widespread that the Federal Trade Commission’s website includes a page dedicated to how to spot and report scholarship scams.

To protect yourself, it is important to know how legitimate scholarship programs work. Legitimate scholarships are always free. There are no application or processing fees. Under no circumstances should a scholarship provider ask for your credit card or bank account information. If this happens, the scholarship is a scam. Also, although scholarship search services help you find scholarships, they cannot complete the applications for you.

Any service that charges a fee to complete your applications is a scam.

Warning Signs of Scholarship Scams:

Scholarship services that charge fees for information you "can't get anywhere else." Free scholarship lists are available from your school counselor, the library and free services like Scholarships.com. Do not pay someone to do the work for you.

Paid services that have guarantees. Read the fine print. If there is any kind of money back guarantee, there will be conditions. There is no such thing as “no strings attached”. If there is a refund policy, get it in writing before you pay anything.

Scholarship programs that have an entrance fee. Before you send money to apply for the scholarship, look closely at all details, even if the fee is reasonable. Low fees do not make a scholarship service or program legitimate. Remember, free money should be free.

Promises from a service that you’ll have easy access to "unclaimed" scholarship money. Ignore the myth of unclaimed funds and the companies that advertise huge amounts of unclaimed money. There are very few unusual scholarships that are specific enough to have unclaimed money.

An organization that guarantees you will win a scholarship by paying a fee. Do not believe a promise of guaranteed funds. No one can guarantee that you will win a college scholarship or grant. Remember: if it sounds too good to be true, it is.

An organization that "sounds like" a non-profit, but has no traceable history. Don't be fooled by official-sounding names and logos. Make sure the foundation, organization or program is legitimate.

Claims by a scholarship service to be "holding" a scholarship for you. Disregard any news that you're a finalist in any contest that requires you to pay a fee for further consideration.

A company that claims it will "handle all your scholarship applications" for you. Resist high-pressure tactics like "We'll do all the work for you." Don't be fooled. There's no way around it, you must apply for scholarships or grants yourself.

Requests for banking or credit card information to "process your application.” Do not give out your credit card, bank or checking account numbers to anyone who claims they need it for you to be eligible for a contest, or access to "exclusive" scholarship information. Remember, scholarships are for you to win money, not for people to take money from you.

ADVERTISEMENT

Latest College & Financial Aid News

What is the FAFSA?

October 8, 2021

by Scholarships.com Staff

FAFSA is an acronym. It stands for "Free Application for Federal Student Aid". Please take note that the first word in the acronym is "Free". You do not need to pay to fill out the FAFSA but there are certainly websites out there that will charge you for their assistance. If you are asked for a credit card at any point in the process, you are at one of these sites. If you do not want to pay to complete the FAFSA, be sure to apply at https://studentaid.gov/h/apply-for-aid/fafsa. The FAFSA must be completed by you and your family each year if you wish to be considered for need-based grants from the college or university you are or will be attending as well as subsidized student loans. [...]

Want to Study Abroad? Find Scholarships

August 31, 2021

by Scholarships.com Staff

A study abroad program can be the beginning of the most exciting chapter of your college experience. Often, the travel, housing, credits and even food are included in the price of the program you choose. However, this is no reason not to look for more financial opportunities! [...]

Movie Night! College Classics

August 19, 2021

by Scholarships.com Staff

As you get ready for this next big step in your life, this last year at home can feel like the longest and the shortest you ever had! While you prepare to select a college and research scholarships and financial aid, don’t forget to spend some quality time with your friends and family. While movies, even when based on a true story, are always a little bit fantastic, they are also works of art that share experiences among their viewers. [...]

Last Reviewed: October 2021