The 5 Most Notorious Scholarship Scams…

And How To Avoid Them

It sounds like a great deal. After all, what parent or child wouldn’t want an additional $1,000 for college?

Unfortunately, a lot of families received a letter just like the one above and completed the necessary forms (along with a check for $94 for a fingerprint certificate and $100 to become a full member in the “National Scholars Alumni Society.”)

But the $1,000 scholarship never arrived.

It was a scam.

You see, one of the most-often asked questions that parents with college-bound kids have for me is, “How can my child get scholarships?”

Part of me can’t blame parents for thinking this way. Who doesn’t want “free money for college?”

But a lot of unsavory people know this single fact about parents. And they prey on them. That’s how letters, like the one above, end up being created. They are created to scam innocent people who are doing everything they can to get help in paying for their child’s college education.

That’s why it’s so important that families protect themselves from falling victim to these types of scams. And the best way to avoid them is to be familiar with the different scams being used.

That said, here are five of the most commonly used approaches scam artists will try in an attempt to steal your money…

Scam #1: Never pay a fee to apply for a scholarship. (No matter how low or inconsequential it may seem.) Some of these frauds ask for “application” or “processing” fees as low as a few bucks and as high as thousands. Some may even tout that those who don’t “win” a scholarship “may” be entitled to a refund. Don’t believe a word. Even if these companies disburse a thousand or two (which some do just to cover their butts), they’ll still make out like bandits. But your chances of getting hit by lightning are better than your chances of landing that money—and you’ll never see a refund of your “application fee,” either. The same is true of loans that ask for a fee up front. And legitimate application or processing fees are usually deducted right out of your disbursement check. True loan and scholarship resources will never ask for money up front.

Scam #2: Beware of how much personal information you provide on a scholarship application. All scholarships have an eligibility requirement. It might be academic, it might be athletic or it might be some form of minority status. But no legitimate scholarship application requires a check, credit card or banking information. If you’re asked to provide more than your standard contact information and some form of proof that you fit their eligibility criteria, chances are you’re being scammed.

Scam #3: There’s no such thing as a guaranteed scholarship. All scholarships have an eligibility requirement and most of them are extremely competitive. Nobody gets a scholarship for his or her bright and toothy smile. Often times you’re asked to pay a fee for some outfit to send you a report of so-called “guaranteed” scholarship opportunities that your child either isn’t qualified for or that don’t exist outright. And good luck getting a refund. Chances are you’ll never hear from those folks again.

Scam #4: Scholarships will never come looking for you. So when you get that letter in the mail or that phone call or that email telling you that you’ve been “selected” or that you’ve won a prize, beware. If you don’t recall applying, then you’re being scammed. The common scenario is that you’re “awarded” a scholarship, but you’re requested to pay “taxes,” a “disbursement” or a “processing fee.” Other times you’re sent a check for more than the scholarship amount because the “fee” is built in, so you’re asked to mail back a check for the fee amount. Their fraudulent check bounces and they’re free and clear with your money.

Scam #5: “You can’t get this information anywhere else.” Scholarships are not a secret. No legitimate scholarship sponsor will align itself with any one scholarship matching service. If it’s out there, your high school guidance counselor or a reputable college advisory firm can find it just as easily as anyone else. Also beware of any outfit claiming a high success rate or that they have “pull” with a given scholarship fund. Less than 1% of people using a matching service ever land a scholarship. And no matching service has control over the scholarship sponsor’s awarding criteria. It just doesn’t work that way.

Key Point: This list of 5 scams are the key ones we (and the FTC)  know about right now. But there will always be rip-off artists building bigger, better and more elaborate scams to get at your money.

The bottom line is, always go with your gut. If it smells like a scam, there’s a reason. Never be afraid to ask questions, get claims in writing and do a little research. If a company doesn’t come up on a simple directory search, be wary.  If a company claims a particular affiliation, verify those claims. Check with your local chamber of commerce or the Better Business Bureau.

As with any industry, there are reputable companies — and then there are the snakes who have absolutely no conscious.  A little extra diligence and some common sense can go a long way to protecting your money.


Scott Weingold
Founder & Publisher, College Made Simple


Scott Weingold is the co-founder and a principal of and the College Planning Network, LLC – the nation’s largest and most reputable college admissions and financial aid planning firm. CPN is a proud member of the Better Business Bureau, the National Association of College Funding Advisors, the National Association for College Admission Counseling, the National Association of Student Financial Aid Administrators and the Student Affairs Administrators in Higher Education.

Scott, along with his college funding advisory team, helps thousands of families throughout the country with their college planning needs, and offers a series of free educational webinars and workshops on “How To Pay For College Without Going Broke In The Process!”  Scott has been ranked the #1 “College Financial Aid Expert Worth Knowing About” in the entire country by He has co-authored the book, “The Real Secret To Paying For College. The Insider’s Guide To Sending Your Child To College – Without Spending Your Life’s Savings.” Scott also publishes a popular free online newsletter, “College Funding Made Simple” which reveals insider’s tips, methods, and strategies for beating the high cost of college.

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