Searching Google for information about student loan forgiveness surfaces advertisements that either appear to violate content policies or lead people to scams, according to a watchdog group, increasing public confusion as the Joe Biden administration mulls actions on student debt.

The Tech Transparency Project, a research arm of the nonprofit Campaign for Accountability, reviewed top searches related to student loans, such as “student loan forgiveness” and “cancel student debt,” to track the ads Google serves up. Of the 242 ads the group reviewed, TTP determined that 29 breached Google’s policies or displayed “scam characteristics,” representing almost 12% of the total.

TTP found that Alphabet Inc.’s Google showed ads for services that charge “questionable fees,” imitate government agencies and request personal data from users for “unclear purposes.”

“We’d like to see them enforce the policies that they do have,” said Katie Paul, director of TTP. “Like we often see with these big tech companies, the statement of that policy is not the enforcement of that policy.”

A Google spokesperson said the company’s rules forbid advertisers from wrongly suggesting they were affiliated with the government, and that there are “strict rules” for ads related to financial services, including a ban on those that fail to disclose fees or push credit repair. “We are committed to combating financial fraud in ads and protecting consumers from scams,” the spokesperson said. “We are reviewing the ads in question and will remove any that breach our policies."

The advertisements are particularly worrisome at a time of heightened interest in federal student loan relief, when more people are likely to be conducting these searches, TTP said.

Payments on federal student loans have been suspended since March 2020, and President Biden has extended the reprieve through Aug. 31. The break on payments has provided for relief for borrowers but also sparked uncertainty about their future obligations. Today, 45 million people collectively owe nearly $1.7 trillion in student loan debt, according to the Student Borrower Protection Center, a Washington-based nonprofit. 

Federal student loans are serviced by third-party companies, and the poor service that borrowers often receive, coupled with the lack of clarity from the Biden administration about the future of student loan relief, has made them even more vulnerable to scams, said Ben Kaufman, director of research and investigations at the Student Borrower Protection Center.

“The borrowers are just screwed,” he said. “They are made to be catnip for these scammers.” 

In 2015, the Consumer Financial Protection Bureau urged Google, Microsoft Corp., Meta Platforms Inc.’s Facebook and Yahoo! Inc. to take steps to ensure that ads for suspicious services did not appear alongside search results related to student loans. Two years later, the Federal Trade Commission launched an effort with 11 states and the District of Columbia to combat student loan relief scams. The cases remain a focus of enforcement, said Michelle Grajales, a staff attorney in the FTC’s division of financial practices.

“Scammers read the news, too,” Grajales said. “They follow those trends as well and, unfortunately, account for them in their pitches to consumers.”

In its report, the Tech Transparency Project singled out a handful of ads displayed alongside Google search results. A search for “student loan forgiveness” yielded an ad for Modify Student Loans, which the Better Business Bureau says it  investigated in 2021.

On its website, Modify Student Loans encourages visitors to enroll in a “Federal Student Loan Forgiveness Program” and pay $39 a month for support, according to TTP.  The FTC states on its website that it is against the law for companies to charge borrowers before providing assistance.

The TTP report also points to a page on Modify Student Loans’ website indicating that it will soon begin collecting information such as pay stubs and portions of tax returns from users. Under Google policy, advertisers may not collect personal data for “unclear purposes,” according to TTP.

In response to a request for comment from Bloomberg, a representative for Modify Student Loans said the company helps borrowers “get an unbiased look at alternative repayment options” and begins working on clients’ cases “even before a payment is made.”

The report also cites an ad from the Credit & Debt Management Institute touting information about a “new government program.” When users click through, they instead receive an offer for services to improve their credit scores after providing payment upfront, according to TTP. The Credit & Debt Management Institute did not respond to a request for comment.

—Bloomberg News