College students are often targets for financial scams because they are often overly trusting and share more information than they should be. According to the Federal Trade Commission, people aged 20 to 29 are among the most frequent victims and accounted for 11 percent of complaints in 2015.
Certified Financial Planner Nahum Daniels shared the five scams targeting college students.
The most common scams targeting college students:
1. Bogus Student Tax
The latest scam focused on college students is called Federal Student Tax, a tax that doesn’t even exist. (source if you choose to use stat: FTC)
Impostors posing as IRS agents are calling college students and are telling students they owe the bogus tax.
The callers often have another piece of information about the student that makes the call seem legit.
In addition, the calls may look like they are coming from the US Government – as they are using spoofed caller ID information.
The caller demands that you wire money immediately. And, if you don’t act quickly enough, the caller might threaten to report you to the police.
Remember, no one from the IRS will ever call you or ask for you to wire money!
2. Tuition Scam
The tuition scam is when a fraudster calls or emails a student, claiming to be from the college admissions department.
The scammer claims the student’s tuition fee is late and that the student will be dropped from classes if a payment isn’t made immediately by credit card.
If you get a call like this, make sure to report it to the college admission office.
3. Fake Credit Cards
Students are regularly inundated with invitations to complete a pre-approved credit card application, either by mail or at campus events.
Yet filling in your name, Social Security Number, date of birth and driver’s license number in public is just opening the door to ID theft.
Plus, some offers are fake, aimed at getting naive students to hand over personal information – or lure them to sites that have malware or add malicious software to the student’s computer.
Always check out a credit card offer before clicking a link or handing over any personal information.
Don’t sign up at a table or booth on campus. Instead, go to the company’s secure website from your private, password-protected Internet connection.
Shred mailed solicitations, which someone could fill out in your name.
Finally, take yourself off marketing lists for pre-approved credit cards. I have a link to the opt out site on my website, nahumdaniels.com
4. False Rental Listings
Many out-of-state students like to search for apartments online and could be tempted to send a deposit without seeing the place firsthand.
Students need to be aware of a common housing scam: the scam artist offers a great fake apartment in an advertisement, collects rent or a deposit for a place they don’t own and then disappears.
Never agree to rent an apartment without seeing it first (both inside and out) and without meeting with the landlord.
5. Friendly Fraud
Friendly Fraud occurs when information is stolen by someone who is known to the victim.
Your dorm room is your home away from home, so it’s natural to feel relaxed and let your guard down. However, dorm rooms are open to many people, some of whom have no qualms about going through your papers for personal information such as bank account numbers, credit card numbers or Social Security numbers.
Leave your important documents, such as your Social Security card and birth certificate, with your parents. If you must bring them with you, store them in a secure, locked space. Carry only physical copies of ID that you actually need, such as your driver’s license or student ID.
Steps parents can do to help their children in college:
Talk to your kids about these scams and educate them about the precautions they can take.
Remind them not to use public wifi if shopping online, checking their bank balance or logging into credit accounts.
Encourage your kids to use strong passwords – a combination of small letters, capital letters and symbols and numbers.
Also, parents should routinely check their child’s credit report to make sure there is no unusual activity.