Building A Digital Defense Against Student Loan Debt


After four great years of college, and maybe a few extra years at graduate school, an American student can walk away with a crushing amount of debt. Add that to rent or mortgage payments, utilities, groceries, gas, and every other adult expense you can imagine, student loan debt can be a heavy burden to bear. For this reason, scammers have found a target-rich environment of people who are desperate to find a way out. 

How this new scam works:

A fraudster contacts you claiming to be from a company affiliated with the United States government. He promises to reduce or completely eliminate your student debt. He will often say that you are “pre-approved” for his company’s programs, and the only thing you need to do to get rid of your student loans is to pay an advance fee of up to $1,500. Once you pay the fee, you will often find that these companies provide no services or provide minimal assistance that you could have received from the U.S. Department of Education for free. 

Here are some tips from our friends at the Federal Trade Commission to remember if you are trying to avoid this type of scam:

  • There is nothing that a company can offer that you cannot do for yourself for free. 
  • Avoid any offer that promises quick loan forgiveness, especially if the person contacting you really has no idea as to the specifics of your debt situation. Many scammers will promise to get rid of your debt fast, but in reality, they can’t help you. 
  • Never pay an upfront fee. In this situation, the FTC says it is illegal for companies to charge you a fee for a service in advance. Many of these companies fail to deliver on their promises to reduce your debt and won’t return your money.
  • Neither a logo nor an official looking website means that the company is real or trustworthy. Many scammers will use lookalike logos or even use a real Department of Education seal to make their company look more legitimate. 

As always, if you have been victimized by this online scam or any other cyber fraud, be sure to report it to the FBI’s Internet Crime Complaint Center at www.ic3.gov or call your local FBI office.

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