Tens of thousands of college students are being victimized this fall by fraudulent companies posing as legitimate foundations, scholarship sponsors and services, the Federal Trade Commission warned.
At a Washington press conference last Thursday, the FTC announced it has filed charges against five companies which allegedly conned nearly $10 million out of college-bound students and their families who were seeking scholarship money.
Jodie Bernstein, director of the FTC's Bureau of Consumer Protection, said all of them ask for an up-front payment, ranging from $10 to $400, and say they will guarantee a scholarship. "Will a legitimate search service really guarantee you a scholarship? The answer is no."
Mark Kantrowitz (SB '89), author of the Financial Aid Information Page on the World Wide Web , said, "A good rule of thumb is if you have to pay money to get money, it might be a scam. Ninety-nine percent of all legitimate scholarship foundations do not charge application fees. I know of only three that do."
Peter Narbonne, outside scholarship coordinator for MIT's Financial Aid Office, told the news conference that the fraudulent companies obtain university phone books and send direct mail to students.
The FTC, which has more information on its Web page at , issued a bookmark with six common themes used by the con artists:
��������������������������� "The scholarship is guaranteed or your money back."
��������������������������� "You can't get this information anywhere else."
��������������������������� "May I have your credit card or bank account number to hold this scholarship?"
��������������������������� "We'll do all the work."
��������������������������� "The scholarship will cost some money."
��������������������������� "You've been selected by a national foundation to receive a scholarship."
A version of this article appeared in MIT Tech Talk on September 11, 1996.
