4 Ways to Outsmart Student Loan Forgiveness Scams

Thieves are always looking for new ways to rob you. They often send phishing emails trying to get you to click on malicious links that install malware on your device or steal account credentials.

More brazen criminals will even have the courage to call you on the phone. They will develop a complex scheme in the hope of deceiving you out of money. If you’ve fallen for a scam, there are some steps you should take right away. For details click or click here.

In this report, we are going to cover several issues that you need to be aware of. First, an education technology company left its database unsecured so that its data could be seen by everyone. Next, scammers take advantage of student loan forgiveness to try to rip you off. Keep reading to find out everything you need to know.

A “careless” approach to cyber security

Studying for your dream career is difficult, and most students need all the help they can get. Chugg, an educational technology company, is one such organization that provides homework help through an app.

When you register, you have to answer a few questions and the data is stored on Chugg’s servers. In theory, the data should be safe, but the Federal Trade Commission (FTC) accuses Chagg of reckless behavior.

According to the legal complaint, the company issued root credentials to several employees and some outside contractors. This means that anyone with such credentials had full access to some of the company’s databases. It was an open door for outsiders.

The FTC alleges that a former Chegg contractor used the data to access information in an Amazon Web Services database. The information includes the names, email addresses and passwords of about 40 million users.

According to the New York Times, information was also taken on the religion, sexual orientation, disability and income of the students’ parents. Some of the exposed data was found for sale online. Chugg is working with the FTC to settle the affected users.

Student loan fraud

The next thing you should be aware of is the complicated scheme involved in the recent student loan forgiveness program. Several victims reported the scheme to the Better Business Bureau (BBB).

Here’s how it works. You receive a call from someone claiming to represent a student loan forgiveness program.

In many cases, scammers have a lot of information they shouldn’t have, including the last four digits of your Social Security number, expiration date, and email address. One victim even reported that the thieves had their FAFSA account information. Oh!

A fraudulent representative claims to be able to help you with student loan forgiveness. They even go so far as to claim they can get you up to $60,000. This is way more than a legitimate program offers, so that should be a red flag. But some fall for it.

According to the BBB, scammers claim you must pay a down payment to get student loan forgiveness. The fee is usually a few hundred dollars spread over a couple of months, followed by smaller monthly payments. Then your loan will be forgiven when the current pause in the loan forgiveness program ends.

But don’t fall for it. This is a scam! You do NO must pay a fee for an official student loan forgiveness plan. If someone calls and asks for payment, hang up immediately!

There are more ways to outsmart these schemes. BBB provided some ideas.

How to Avoid Student Loan Forgiveness Scams:

• If in doubt, contact the government agency directly. If you receive a message that seems legitimate but you’re not sure, stop communicating with the person who contacted you. Then verify their claims by contacting the government agency they say they represent. For details on the student loan forgiveness program, visit ED.gov or StudentAid.gov.
• Never pay for a free government program. Government agencies will never ask you to pay a fee to take advantage of a free government program. Don’t let scammers convince you otherwise. Scammers may say that paying faster will bring you relief or unlock additional benefits, but that’s all part of the scam.
• Think twice about unwanted calls, emails or texts. Usually, government agencies will not contact you unless you ask them to. Unexpected connections are a red flag.
• Don’t fall for scare tactics. If someone claims you’ll miss out if you don’t take immediate action, be wary. This urgency is a common tactic scammers use on victims. Instead of responding, stop communicating until you’re sure they’re telling the truth.

If you come across a student loan forgiveness scam, report it. Sharing your experiences at BBB.org/ScamTracker can help others avoid becoming victims.

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