New Financial Scams Targeting College Students

For many, entering college means taking the first steps into adulthood, along with all that comes with that new role. And for some students, higher education starts before any education in financial literacy. It is just those students, unfortunately, that have lately become the victims of scammers looking to make a quick buck.

In Minnesota and North Dakota, the Better Business Bureau (BBB) reports two new scams designed to both swindle money from unsuspecting students and former students, and, most likely, simultaneously engage in identity theft. Throughout the nation, identity theft is on the rise and means big business to those that engage in scams to steal everything from credit card numbers to social security numbers.

One of the most vulnerable demographics is college students, because studies show that as a group they are much less likely to regularly monitor their credit scores. Most are not yet thinking about large purchases such as car loans or mortgages, and are distracted by all the pressing concerns of a student’s life that do not revolve around credit score. This can turn students into easy targets.

The first of the two scams recently reported by the BBB consists of callers that claim the student or former student owes unpaid taxes on their college tuition. Sometimes the caller knows detailed information, which they may try to persuade the student to confirm over the phone prior to requesting payment on the supposed “taxes.” Of course, tuition is never taxable and these calls are not from any genuine debt collector or government agency, the BBB warns.

The second scam again involved a caller seeking money from the potential victim, this time claiming a “one-time student fee of $1,600 was owed.” The caller in this instance claimed to be from a government agency. Prior to asserting that such a fee was owed, the caller gave detailed information about the former student and attempted to get the information confirmed over the phone. The BBB has not reported on the success of these scams, but warns all students and former students to be on alert for these and others like them.

There are several ways to protect yourself against identify fraud. The first and easiest is to simply be aware that these scams exist and to never give out or confirm sensitive personal information over the phone. Remember that such information can be gotten through a variety of ways, from the more sophisticated, such as hacking into your email, to the more mundane, such as someone going through your trash.

The BBB also has many additional recommendations to protect yourself. One mistake many students make is not having sensitive mail sent to their permanent address instead of a dorm address, where it is easier for others to swipe mail or gain access to its contents before replacing it in the mailbox.

Additionally, never loan out your credit card or debit card for any reason – even after the physical card is returned, you don’t know who may have seen or written down your card’s information for future, unauthorized use. And always keep sensitive documents, such as those containing your social security number, in a lockbox with a combination that only you know. Better yet, if you need only occasional access to them, have parents keep ahold of them while in college, especially if you live in a shared space such as a dorm or with a roommate.

Many students think they won’t become the victims of fraud or identity theft simply because they have nothing on their credit report, but exactly the opposite is true. A clean credit report, without any good or bad credit reporting, is extremely valuable to criminals. Scams such as those reported lately by the BBB are on the rise – and smart students are urged to be as careful with their budding credit scores as they are with their grades.