Fraud Alert: Phishing Scam Targeting Financial Aid Distributions and Refunds

August 25, 2018

The Department of Education is warning college students about a phishing scam targeting financial aid distributions and refunds. Here’s a description of how the scam occurs:

• A student receives an email directing them to log into their school’s billing portal to view an updated billing statement. The billing portal is where students pay tuition and fees and provide checking account information for financial aid direct deposits.
• The student clicks on a link in the email and unknowingly enters their login credentials on a fake website.
• Scammers use the information to access the student’s account on the real billing portal site, where they change the student’s direct deposit destination to a different bank account.
• When financial aid disbursements and fee refunds are paid, they are deposited to the scammer’s bank account, not the student’s.

This is a very serious scam that could leave students without the money they need for food, books, and other expenses for several weeks. Please warn college students and their parents about this scam and provide them with the following instructions on how to avoid becoming a victim:

If you receive an email from your school’s payment portal, do not immediately respond to it. Instead, take one of the following actions:

• Login to your student account directly from your school’s website, not from a link in an email.
• Contact the financial aid office at your school to make sure the email you received was actually from them.

Be extremely cautious about clicking on links in emails. If you have any question about the authenticity of the email, you can always navigate directly to a trusted website rather than clicking a link.

Do not reply to emails, phone calls, text messages, or social media DMs that ask you for personal/identity information, such as login credentials, account numbers, your birthdate, Social Security Number, or the IP address for your computer.

For more information about this latest scam, visit the Federal Student Aid Information for Financial Aid Professionals (IFAP) website.