Protect Your Bank Account From Financial-Aid Scams
College Financial-Aid Offices Offer Free Advice, Materials
5:15 AM, Jun 10, 2004
With college tuitions skyrocketing, families are looking for creative ways to pay for their children's education.
But unfortunately, the Federal Trade Commission says many families fall prey to scholarship and financial-aid scams in the process.
The FTC has taken action against 12 financial-aid companies in the last four years.
In one case alone, at least 12,000 families were taken for more than $13 million. The companies made promises for college money that was never received.
But the best advice from college financial advisors is don't pay for what you can get for free.
John Casdorph has spent 25 years helping students find financial aid at Cal State-Bakersfield. He warned families to be weary of companies that offer financial-aid services for a fee.
"The chancellor's office at CSU has a position on companies that charge to provide a search service for financial aid and they don't encourage students to use those services," Casdorph said.
One New York-based company, Edifi, is coming to Bakersfield this weekend to host a free workshop. However, there is a price tag attached. If consumers decided to use Edifi while at the workshop, they are charged $895. However, if they wait, then the price goes up to $1,295.
Connie Alarcon of the Better Business Bureau said consumers shouldn't sign under pressure.
"If you are going to a workshop and they are telling you that you need to sign 'this document, at this point in time or the discount isn't available to you,' it's better that you are safe than sorry," Alarcon said.
Edifi has an unsatisfactory record with the New York BBB, but has not been investigated by the FTC.
John Braat, the chief operating officer for Edifi, defended his company and said that Edifi has been working to resolve complaints and improve its BBB rating.
Alercon said consumers should rely on the BBB report.
"We are here to help educate consumers and to help them from getting scammed or be in a situation where they aren't going to get their money back," Alercon said.
Casdorph said you should use your free services from local colleges and university financial-aid offices.
"We exist here as a financial-aid office to help students for free. We'll counsel them on financial-aid applications. We'll help them fill out forms. We'll even give them direction on how to search for scholarships, which is the harder part of financial aid," Casdorph said.
You can use CSUB, Bakersfield College, or any community colleges financial-aid services for free, even if you haven't been accepted as a student.
To contact the CSUB financial office, call (661) 664-3016 or stop by during office hours. To contact Bakersfield College, call (661) 395-4427.