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How to Report Scams

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Many of the most common scholarship scams violate federal and state laws against fraud and false advertising.

If you suspect that a scholarship program might be a scam, get a second opinion. Bring a copy of all literature and correspondence concerning the scholarship to your guidance counselor or your school's financial aid office. They can provide you with accurate and current information and verify whether a foundation is legitimate.

To report a suspicious offer, write a letter summarizing your experience with the company to any of the anti-fraud organizations listed here. Be sure to include the details of your complaint, the steps you took to try to obtain satisfaction and the company's response to your efforts. Provide as much information as possible, including names, addresses, phone numbers, fax numbers and copies of advertisements, letters and postcards.

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It is also helpful to include a copy of any notes you took during a telephone conversation with the company. It is best if the notes are taken during or immediately after the conversation. Write the date and time of the conversation on the notes, as well as the name of the person with whom you spoke and any important statements they made. Try to be as thorough as possible.

Where to Report a Scam

The following organizations can help you determine whether an offer is legitimate. They will tell you whether they have received any complaints about the company, or whether it's currently under investigation. They can also provide you with additional information or assistance.

National Fraud Information Center (NFIC)
In addition to providing helpful information, the NFIC will pass your complaints along to the appropriate authorities, such as the Federal Trade Commission (FTC) and your state's Attorney General's Office. The NFIC also maintains a toll-free hotline at 1-800-876-7060.

National Fraud Information Center
PO Box 65868
Washington, DC 20035

Federal Trade Commission (FTC)
The FTC does not handle individual cases, but can take action against a company when it sees a pattern of fraudulent activity. The FTC Consumer Response Center also has an online Complaint Form and can be reached at 1-202-FTC-HELP (1-202-382-4357) or 1-877-FTC-HELP (1-877-382-4357).

Correspondence Branch
Federal Trade Commission, Room 200
6th Street & Pennsylvania Avenue, NW
Washington, DC 20580

State Attorney General's Office
If you wish to file a complaint with the office of the state Attorney General, it is best to direct the complaint to the Bureau of Consumer Protection. This is the office that is responsible for enforcing laws that protect consumers from fraud. The State Registry of Charitable Trusts can tell you whether an organization is a legitimate tax-exempt foundation. The New York, Oregon and Illinois Attorneys General have filed suit against or obtained voluntary compliance orders against several companies.

Better Business Bureau (BBB)
The BBB site offers electronic complaint forms and includes a directory of BBBs in the US and Canada. You can also request, by phone, a BBB report on a particular company. The BBB web site also provides a national database of reliability reports. This database combines information from several regional BBB databases, such as the Boston and New York BBBs. When inquiring about a suspicious company, it's useful to contact both your local BBB office and the office closest to the company's headquarters, because each BBB maintains its own set of reports. A positive report doesn't mean the company is necessarily legitimate, but companies with negative reports should be avoided. The BBB also publishes two brochures about scholarship scams: BBB Warning: Scholarship Search Services (July/August 1994) and Tips for Consumers from your Better Business Bureau (Scholarships, March 1996). For the phone numbers of BBB branches nationwide, call 1-703-525-8277.

Council of Better Business Bureaus
845 Third Avenue
New York, NY 10022.

US Postal Inspection Service (USPIS)
If your problem involves mail fraud -- if any part of the transaction took place through the mail -- you should check with the US Postal Inspection Service. The Service also publishes a helpful booklet (Publication 281) on this topic and maintains the Postal Crime Hotline at 1-800-654-8896.

Chief Postal Inspector
475 L'Enfant Plaza, SW
Room 3021
Washington, DC 20260-2100

US Department of Education Office of the Inspector General
The Inspector General at the US Department of Education focuses on cases where the US Department of Education has been defrauded. Examples include cases where financial aid "consultants" urge families to falsify information on the FAFSA. Other recent cases can be found on the OIG investigative activities web page. To report this type of financial aid fraud, call 1-800-MIS-USED or 1-202-205-5400, send email to oig.hotline@ed.gov, use their online complaint form, or send a hardcopy of the special complaint form to Inspector General's Hotline, Office of Inspector General, U.S. Department of Education, 400 Maryland Avenue, SW, Washington, DC 20202-1510.

Report it to the FinAid Page

Also, please send information about any possible scam or suspicious advertisement to scams@finaid.org with the name of the company in the subject line. You may also fax FinAid at 1-724-538-4502.

 

 
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