HARRISBURG, Pa. (WTAJ) — The Pennsylvania Department of Banking and Securities (DoBS) and Pennsylvania Department of Education (PDE) warned student loan borrowers Thursday of increasing loan debt forgiveness scams.
The scams are reportedly targeting people who are facing financial struggles caused by the COVID-19 pandemic and are seeking relief from their student loan debt. Secretary of Banking and Securities Richard Vague says those who receive an email, letter, or call about student loan debt forgiveness should pause before sending or confirming any personal information.
“With the continuing pandemic, many consumers have been in search of financial relief,” said Vague. “Like other scams, these perpetrators prey upon the hope and vulnerability of people, creating an ideal scenario to take advantage of them.”
The department says an uptick in scams from individuals and companies is a result of confusion surrounding the multiple changes to student loan payments such as the recent pandemic-related pause in loan payments, the public calls for broad-based loan forgiveness, various executive actions, benefits and concerning loan balances.
“Many students and families across Pennsylvania borrow funds to help finance post-secondary education, resulting in debt that may take years to pay off,” said Secretary of Education Dr. Noe Ortega. “It’s important for borrowers who are seeking student loan debt relief to be aware of the associated scams and avoid them at all costs.”
Borrowers are advised to take the following actions to help guard against these types of scams:
- Be skeptical. Scammers often obtain student loan information illegally. Just because someone has information about your loans, doesn’t mean they are to be trusted.
- Research the company. Check the validity of the company contacting you as many “companies” run by scammers do not actually exist.
- Do your due diligence. Check what program is being offered to you. Some scams offer to enroll you in programs like the “CARES Act loan forgiveness” or the “Biden forgiveness program,” neither of which exist.
- Verify that email address. Ensure that emails being sent to you about your student loans are from a dot-gov (.gov) email address.
- Be aware of what legitimate programs will and won’t ask you for. Proceed with caution before sharing any of your sensitive or financial information like a Social Security Number or credit and bank information. If in doubt, hang up and call your servicer directly.
- Pause before taking action. Confirm any correspondence or calls with your servicer before taking any action.
What should you do if you suspect you’ve already been scammed?:
- Close Accounts/Stop Payment: If you shared your bank account or credit card information with a scammer, contact your bank or credit card company immediately to close your accounts or stop payments.
- Alert your servicer. If you suspect you’ve been the victim of a student loan forgiveness scam, call your servicer so that they can monitor your account.
- Monitor your credit report. Check for suspicious activity. Scammers don’t always use your information right away. It can be weeks, months, or even years before your information is used for fraudulent activity. You might also consider freezing your credit in an abundance of caution.
- Report the scam. You can report a student loan forgiveness scam to:
For more information, visit the Pennsylvania Department of Education website.