"Consumer Confidence in the ability of companies to protect their users' private data is falling. Yet, while applying for college financial aid often requires families to submit an incredible amount of personal information online – including tax details and Social Security numbers – there are protections in place for information submitted on the Free Application for Federal Student Aid, or FAFSA," according to U.S. News & World Report.
..."Once a college or university receives a family's financial information, the sharing of that information remains limited.
'Because of the use restriction, even within the institution itself, they can't use the FAFSA data for other reasons,' says Karen McCarthy, director of policy analysis at the National Association of Student Financial Aid Administrators.
'So say if a professor wanted a list of all of the students in his class who were receiving Pell Grants. That professor would not be able to get that information because that FAFSA data and the use of that data would not be for aid purposes,' she says.
While information is generally considered secure when applying for federal student aid, seeking and applying for private scholarships and loans can be riskier. There are fewer legal protections in place for these applicants, and it can be challenging to separate legitimate scholarship organizations from websites and emails looking to collect and sell student data, Vance says.
'Worry about any website that is not official and not the FAFSA. Double check that it's not a phishing scheme,' she says. 'That 'low interest private loan for college' in your inbox, and especially those scholarship websites that are asking for incredibly intimate information, a lot of those websites can be fronts for data brokers.'"
Publication Date: 11/2/2020