Payment Week – By Michael Dautner, Editor-in-Chief of Payment Quarterly
Recently, I had the pleasure of speaking with Peter Butterfield, CCO at Flywire, to dig deeper regarding the extent of fraudulent transactions at the expense of numerous students studying abroad.
Australia, Europe, and the United States, are noted as the leading destinations for international higher education seekers. Beyond that, there are about 975,000 international students in the United States alone that account for more than $14 billion in tuition dollars. As you might imagine, this poses an ever-tantalizing opportunity for fraudsters looking to rip off students, and parents of students.
Students studying abroad deal with a considerable amount of unknowns; be it a new language, a new culture, or meeting entirely new people they have little to nothing in common with. Add on the risk of fraudulent tuition scams, and you have a complete headache from a foreign student’s standpoint.
Flywire, however, wants to eliminate this threat, and ease the minds of these knowledge seekers by working together with hundreds of universities to stop fraudsters in their tracks. Peter Butterfield spoke with me exclusively about the hazards students and parents face when attempting to pay for their child’s tuition payment in a foreign country.
The issue begins at the source with students (typically students of means) seeking out highly prestigious universities in the United States. Once they have selected the institution of their choice, upon acceptance—students will eventually stumble across an advertisement that claims to be an easy, hassle free method of making international tuition payments.
According to Butterfield, scammers will conjure up a marketing scheme that claims things like a percent of savings for using their service. He spoke to me extensively about the impact this fraud pattern has on Chinese students in particular. The students and parents are eager to align with a ‘program’ that claims there is someone willing to deal with the tedious task of handling tuition payments from one country to another, and at a fraction of the cost to boot.
Mr. Butterfield also spoke about a high number of students receiving phone calls from scammers in regard to a phony Federal Student Act that demands students pay a recurring tax on their tuition payments, or else risk not being able to attend the institution of their choice at the start of the semester.
It is seen over and over again, with a recent story coming out of the University of Washington just this past August detailing a total of $1 million dollars in tuition being fraudulently obtained by scam artists.
The students, all of whom hail from China, were told they could save up to 5 percent—about $600—off the $11,340 cost of summer tuition by paying an intermediary, according to UM Police Investigator Lt. Doug Schultz.
The word spread like wildfire due to a prominent, and well-trusted Chinese student getting the word around about the discount via the popular Chinese social media app called WeChat.
It seems so innocently placed, a simple discount for being proactive about your tuition payment. It does not sound too far-fetched or too good to be true to many students. That mentality seems to be these students’ downfall, trapping them in this elaborate scheme that seeks to exploit Chinese students in particular.
Another similar scam also reported in August comes out of Michigan State University, where the promise of a discounted tuition again lured students in.
The intentional targeting of international students has caused uproar in East Lansing, Michigan; as this report of tuition scammers was uncovered.
Essentially, the scammers ask for the student’s login credentials, which they in turn use to pay the student’s tuition with a stolen credit card. Then, once the transaction goes through, the scammers instruct the student to use a wire or check transfer to pay them at the discounted rate. Lastly, the company of the stolen card then reverses the transaction—leaving students with a full tuition balance, and no way of retrieving the funds already transferred to the fraudsters.
A simply shameful, yet harsh reality the innocent international student is facing in pursuit of academia is tuition fraud. They never know what hits them.
However, Peter Butterfield, and the good people over at Flywire have gotten to work to figure out a better solution for international students to pay their tuition safely and seamlessly.
Through essential partnerships made with universities, Flywire aggregates wholesales on tuition, eliminating transaction costs for students, and giving them multiple options for making a payment.
They operate hand-in-hand with universities across the globe to crack down on fraudsters, and allow students to worry about one thing, and one thing only: their studies.
That is what college is all about. Finding the best ramen spot off-campus, cramming that extra index-card study session in before the big exam, and making friends and memories that will last a lifetime—NOT tuition fraud.
It’s about time these international students put aside their worries pertaining to tuition payments, and focus their time and energy on being the best students they can possibly be.
I thank Flywire for keeping us in the known, bringing this shameful practice to light.
from
http://blog.flywire.com/2016/10/19/combatting-international-tuition-fraudsters-with-the-help-of-flywire/
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