Student loan scams are nothing new. Bad actors posing as loan servicers, lenders, and the like have long preyed on borrowers with empty promises of relief in exchange for cash or sensitive personal data.

But with the application for student debt forgiveness launching later this month, millions of borrowers have questions about their loans right now — and their search for answers has sparked an unprecedented boom in scams. 

Per recent reports, countless scammers are targeting borrowers with phone calls, texts, and emails that push potential victims to pay a hefty fee in order to access the forgiveness application — which the Education Department has confirmed will be free. More worrying still, more than one in ten ads displayed in Google searches for topics related to student loan forgiveness are fraudulent. 

And despite the White House’s efforts to crack down on scams, experts predict that this is just the tip of the iceberg. When the moratorium on federal student loans ends on December 31, millions of borrowers will face their first monthly debt payment in almost three years — creating ample opportunities for scammers to prey on borrowers’ heightened stress and sense of urgency.

Employers should take note of this growing concern. After all, student debt is already a big enough distraction in the workplace without the added tumult of scammers. But HR leaders can take steps to help employees avoid falling victim to student loan scams — here’s how:

Highlight red flags 

Many of the recent student loan forgiveness scams have at least one of three major red flags:

  • Fees. Multiple officials have confirmed that the application for student loan forgiveness will be free, so borrowers should be wary of any requests for payment in order to access the application or for a service to complete it on their behalf. Similarly, any attempts to collect a fee to unlock early access to the forgiveness application or guarantee their eligibility are fraudulent.
  • Immediate urgency. While borrowers should plan to complete their application by mid-November if they want to receive forgiveness before monthly student loan payments resume in January, the application will remain open through the end of 2023 — so borrowers should be skeptical of any advice to take immediate action to avoid becoming disqualified for forgiveness.
  • Any non-official application or forms. If a borrower is being asked to complete paperwork other than the official application from the Department of Education in order to receive forgiveness, they’re likely being scammed. The White House has shared a preview and a beta version of the form, which borrowers can reference if they’re unsure of a form’s legitimacy.

The same advice applies beyond forgiveness, too: borrowers are never required to pay a fee to consolidate their federal loans, switch to a new repayment plan, access their loan history, check their eligibility for a program, and so on. Strict or urgent deadlines are rare, but borrowers will have plenty of advance notice if they must take action before a specific date. 

Underscore common sense tips

Most of the tactics used by student loan scammers are utilized in other types of phishing attacks, too. Remind employees to watch for common signs of a scam, including:

  • Grammatical or spelling errors
  • Suspicious sender email addresses, especially those not linked to a trusted domain (e.g. .gov or a domain belonging to their student loan servicer)
  • Requests for personal information, such as the employee’s social security number
  • Requests to share credentials for the employee’s banking, student loan servicing,, or other private accounts

Share steps employees should take if they encounter a scam

Direct employees to report any calls, texts, or emails they suspect to be fraudulent to the Federal Trade Commision at The FTC shares these reports with law enforcement across the country to help crack down on scams. If an employee is being contacted by someone claiming to be from their student loan servicer or the Education Department but they’re unsure of the validity of the outreach, they should contact that agency directly to confirm. 

If a borrower has already shared personal information with a scammer, the Education Department advises taking the following steps:

  • Update their FSA login credentials 
  • Contact their student loan servicer to revoke any power of attorney or third-party authorizations, and confirm whether the scammer has made any changes to their loans or account
  • Contact their bank or credit card company to request that payments made to the scammer be stopped
  • File a report with the FTC and the Federal Student Aid Feedback System

Provide a trusted source of truth

Candidly was founded to help employees navigate their student debt — and all the roadblocks that come along with it, including scams.

By providing an all-in-one, secure platform, Candidly enables HR stakeholders to help workers manage every aspect of their student loans, including finding trusted, personalized guidance through our exclusive content and expert coaching service.

In turn, employees are empowered to cut through the noise to tackle their debt faster and smarter, focus on other financial goals, and build a stronger sense of loyalty to their employer.

Interested in learning more about bringing Candidly to your workplace? Request a demo today.