The Scholarship Coach Feature:
9 Signs of College Scholarship Scams

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by Michelle Showalter

The Scholarship Coach always encourages prospective and current college students to apply for as many scholarships as possible in order to receive the maximum amount of free financial help. But every year, scores of students fall victim to those looking to make a quick buck off of your dream of going to college.

To protect yourself from scholarship scam artists, look for these warning signs. After all, the last thing you want is less money in your pocket.

[Learn 4 do's and 1 don't for finding scholarships.]

1. Application fees: Stay clear of any scholarships that require you to pay a "small processing fee," even if it's just a few dollars. The provider may claim it's to weed out "non-serious applicants," but don't be fooled. Legitimate scholarships want to give you money, not take it away.

2. No phone number: Be extremely wary of any scholarship opportunities that don't provide a telephone number. A lot of scholarship scams don't give out phone numbers because they're too easy to trace.

3. Open to everyone: The majority of private scholarship providers choose to award scholarships to students who fit a certain set of criteria. If you come across a scholarship that's open to everyone, do some extra research on the scholarship provider before you apply.

[Read 7 things you need to know about private scholarships.]

4. No proof of past winners: Try Google searching the scholarship and look for evidence of past winners. Most scholarship providers like to brag about the money they've given out, so if you can't find any history, the scholarship could be a scam. This isn't always the case, though. New scholarships, of course, don't have past winners.

5. Fake nonprofit or federal status: Even if a company has a Washington, D.C. address or its name sounds official, beware—it could easily be fake! And just because its name has the word "Foundation" or "Fund" in it, that doesn't necessarily make it a nonprofit.

6. Requests for personal financial information: It's completely unnecessary for a legitimate scholarship provider to ask you to provide a credit card, bank account, or social security number. If you get a phone call from someone claiming that they need this information to process an application, disconnect the call immediately.

7. Winning a scholarship that you didn't apply to: If you get a call (or E-mail) from a scholarship provider proclaiming that you've just won a scholarship, but you have no idea who they are and have never submitted an application for that particular scholarship, it's most likely not legitimate. Don't give them any information; just hang up / delete the message.

8. Claims that they'll "do all the work for you:" We've made it clear that it takes a lot of work to apply for scholarships. Sorry, but this is unavoidable.

9. Search fees and claims "you can't get this information anywhere else": There are many excellent scholarship search engines that are completely free to you. You should never pay for results that you can get for free. The last thing legitimate scholarship providers want is to keep their scholarship a secret.

If you encounter a scholarship scam, prevent others from falling victim by reporting it to the Federal Trade Commission. Visit www.ftc.gov or call 1-877-FTC-HELP.

Michelle Showalter joined Scholarship America in 2007 and is an alumna of Luther College in Decorah, Iowa.

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