Student Loan Scams Likely As Federal Loan Forgiveness Begins — 6 Cybersecurity Expert Tips

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With President Biden announcing new student loan debt relief policy this week, a “perfect storm” for scam artists to target people with fraudulent offers concerning said benefits has been created, per Zulfikar Ramzan.

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Ramzan is the chief scientist at Aura, a consumer cybersecurity company that helps protect individuals and families against digital threats. He’s also an author with 25 years of experience in the field of digital safety.

As soon as Biden’s announcement went out on Aug. 24, Ramzan said that new scams were being rolled out almost immediately. Actors pretending to be government officials or student loan officers are offering to purportedly help people retrieve the $10,000 (or $20,000 for Pell Grant recipients) in loan forgiveness that’s part of the announced relief measures.

“Within hours, people started getting phone calls. We’ve been seeing very early signs of activity that we are monitoring closely,” Ramzan shared. “Scammers have had a banner year because there’s so many opportunities to go after people. And in that way there’s no rest for the weary, so with the announcement regarding student loan debt relief we’ve immediately seen scammers take advantage.”

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Part of the reason scammers consider student loan angles so lucrative is because, for threat actors, it’s all a numbers came — especially given the number of Americans concerned. According to the 2022 U.S. Census, 1 in 7 Americans has student loan debt.

“So if a scammer calls a bunch of people, statistically many of them will have a student loan. Not only that but many people will think they qualify and be receptive,” said Ramzan, adding that scammers have gotten very savvy in customizing outreach to make their pitch sound legitimate and personalized to your situation.

“For example, they might call and note, ‘We know you’ve been out of school for this many years,’ and you believe it because how could they possibly know this about me if it wasn’t authentic?” Ramzan said. “But what people may not know is that a lot of that data is already out there, and the internet has made it easier to get to. It’s a matter of finding the right public records and coalescing them.”

With so many people affected by student loan debt — 45 million Americans are impacted, according to the latest U.S. Census — Ramzan notes that “everyone under the sun is probably going to get an email or text about supposed relief programs.”

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So how do you protect yourself? According to Ramzan, it’s all about having awareness and digital street smarts. Here are some of his tips.

  • Any call or message about student loan relief right now is likely fraudulent. That’s because there’s been no guidelines established yet by the government — the news just broke on Aug. 24 and might take a while to implement. So anyone calling you and letting you know that they can help secure your $10,000 is a big red flag.
  • Don’t give out personal information over the phone. “As soon as you start hearing people ask for your personal financial info, your ‘Spidey Senses’ should be flaring,” says Ramzan. They usually want your bank routing number and account number, Social Security number and credit card information — which they claim to need to process the application, but is really a front to gain access to your financial info.
  • Validate the person before continuing the conversation. Scammers call out of the blue, and even if you are expecting a call regarding the matter, always vet the person first. Ramzan suggests asking for their name, company name and phone number and let them know you’ll call them back. That way you can do some research to see if the agency they represent is legitimate and search the phone number they provide to see if it’s linked to a real company.
  • Be very careful with unknown websites. “If people would stop clicking on links from unknown sources a lot of the world’s problems would go away,” Ramzan jokes. He also notes more often than not with scams, you will be contacted and redirected to a website to enter info. It may look very authentic as it’s easy to make a replica, but always look closely at the website to ensure it’s official. For example, any real government website will have a .gov extension.

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  • Use good passwords. When it comes to digital security, one of the easiest and most effective things you can do is to have good passwords that prevent scammers from accessing your info. Ramzan suggests using a password manager to pick options that are more complicated — these applications can also help you to change passwords periodically.
  • “Don’t trust anyone on the Internet.” As Ramzan says, “In these times people are vulnerable, they are expecting to be contacted. They need the means, because we are in a tough economy, and all of a sudden a miracle comes around. But one moment of weakness can take a whole lot of critical information, and 15-20 seconds later, that information is being leveraged and monetized before anyone knows it’s happening.”
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About the Author

Selena Fragassi joined GOBankingRates.com in 2022, adding to her 15 years in journalism with bylines in Spin, Paste, Nylon, Popmatters, The A.V. Club, Loudwire, Chicago Sun-Times, Chicago Tribune, Chicago Magazine and others. She currently resides in Chicago with her rescue pets and is working on a debut historical fiction novel about WWII. She holds a degree in fiction writing from Columbia College Chicago.
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