The Better Business Bureau is urging post-secondary students to use caution when applying for financial aid and has a few tips to help people identify red flags and avoid scams.

Canada’s Anti-Fraud Centre says in 2012, Albertan’s lost over $6M to scammers posing as legitimate foundations offering scholarships and awards.

About 1,500 victims in Alberta were adults between the ages of 20 to 29, with a reported loss of nearly $2M.

The BBB says most post-secondary students are in this age range and should use caution when applying for financial assistance.

"Since the cost of post-secondary education is high, a lot of students are applying for various forms of financial aid in order to continue pursuing their educational and professional goals," said Sandra Crozier-McKee, President and CEO of the BBB Serving Southern Alberta and East Kootenay. "Students may think of themselves as unlikely targets or that they won't fall victim to scammers' tactics and tricks. If you are a student applying for financial aid, check with the BBB for consumer tips that could keep you from paying for your financial aid."

The BBB urges post-secondary students to watch out for these red flags when applying for financial aid:

  • "The scholarship is guaranteed or your money back." In reality no one can guarantee they will get you a grant or scholarship. The refund guarantee offers usually have many conditions or strings attached making it almost impossible for consumers to get their money back.
  • "You cannot get this information anywhere else." Scholarship information is widely available in libraries, financial aid offices and often very conveniently on the Internet.
  • "You have been selected by a foundation to receive a scholarship." If you have not entered a competition sponsored by the foundation, this claim is highly unlikely.
  • "May I have your credit card or bank account number to hold this scholarship?"  Never hand over your personal information. This is never a requirement for a legitimate scholarship offer and it is most likely a scam.
  •  "The scholarship will cost some money." Legitimate scholarship offers never require payment of any kind. You will not be required to pay for financial assistance.
  • "What is your Social Security number?" You should never share your Social Security or passport number over the phone. If you are asked to do so, ask why this information is required. It is highly likely this is a scam so it is best to walk away.
  • Only apply to scholarships, bursaries and awards you know and trust. Each post-secondary institution has faculty specific awards offered each year that you are most likely familiar with. Other financial assistance awards are named in memoriam of well-known members of society (i.e. the Terry Fox Humanitarian Awards). Also, ensure to seek the assistance of the student financial aid office at your college or university to ensure you are correctly applying for scholarships and other offers.

For information on scams and fraud prevention, visit the Canadian Anti-Fraud Centre. For consumer tips and other information visit bbb.org.