How to Stay Protected From Lurking Student Loan Scammers

The Biden administration announced last Wednesday that it would forgive up to $20,000 in undergraduate student loans.

Some borrowers have already had their accounts updated, but others will need to apply for the benefit in October.

However, this amount may not clear accounts for everyone, and scammers may be on the prowl promising to help eliminate any remaining debt.

Pay no upfront fees

It is illegal for student debt relief companies to charge you before administering a service, states the Federal Trade Commission.

Don’t sign up for a quick loan forgiveness

Anyone who guarantees your eligibility to have your student loan forgiven or promises that they can get your loan forgiven faster than the deadline set by the Department of Education is a scammer.

Don’t always trust the Ministry of Education logo

Scammers can use logos, names and seals to persuade you of their legitimacy. But if you have questions about your federal loans, visit the Department of Education’s official financial website at

Don’t rush into a decision

Scammers will often make supposedly urgent requests — like missing a deadline to qualify for repayment plans, loan forgiveness programs, or federal loan consolidations — in an attempt to get you to act quickly.

Never Share Your Federal Student Aid ID

Scammers may ask for your FSA ID in an attempt to steal your identity, but you should never share your account credentials.

How to get your money back if you paid a scammer

Scammers may trick you into paying them in a way that makes it more difficult for you to get your money back, but there are certain actions you can take depending on the payment method you used.

  • Debit or credit card: Contact your bank and report a fraudulent charge. Ask them to waive the fee and refund your money.
  • Bank transfer: If a scammer made a transfer from your bank account, report it to your bank.
  • Cash: If you sent cash in the mail, contact the US Postal Inspection Service (877-876-2455) and see if they are able to intercept the package. If you used a different postal service, contact that company as soon as possible.
  • Gift card: Contact the company that issued the gift card, report fraudulent activity and request a refund. Keep the gift card and gift card receipt if possible.
  • Wire Transfer (i.e. MoneyGram or Western Union): Contact the company.
  • Money Transfer App (i.e. Venmo or Cash App): Contact this company to see if they will issue a refund. If the account is linked to your bank account, call your bank as well.
  • Cryptocurrency: These payments are usually irreversible. The recipient should be prepared to return your money. However, it is still worth trying to contact the cryptocurrency company.

How to report a scam

You can report scams to the FTC at or to your state attorney general.

What if my devices and personal information have been compromised?

If you provided personal information to the scammer, such as your social security number, go to If you’ve shared login information, update your passwords with a secure combination of upper and lower case letters, numbers, and symbols.

If a scammer has access to your computer, update the device’s security software, run a scan, and get rid of any files that might reveal too much information.

If your cell phone is compromised, contact your provider and check your bank statements for any unauthorized transactions.

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