DOJ charges five in AI-aided ghost-student loan fraud
Original title: DOJ exposes “ghost students” using AI to complete courses, steal student loans
Officials tie more than $32 million in confirmed loss to the charged subjects and seized over $750,000 in cryptocurrency.
The US Department of Justice charged five people in what it calls the first broad federal crackdown on “ghost students” who use stolen identities to enroll and collect federal student aid. The DOJ says the scheme partly relies on AI to complete applications, coursework and fake class attendance, and that leftover aid is sent to accounts controlled by fraudsters. The Education Department has flagged over 830,000 potentially fraudulent aid accounts. If all were fraudulent, losses would approach $130 million, which the DOJ presents as conditional.
Unconfirmed: The 830,000 accounts are “potentially fraudulent,” and the near-$130 million loss figure applies only if all of them are ghost students.
- One defendant allegedly received about $1,439,548 across more than 700 aid refund deposits.
- Another person allegedly received more than $1 million linked to more than 300 accounts.
- The DOJ suspects the scam has run since at least 2021 and sent about 50 FBI referrals.
- Victims are often high-school graduates who never attended college and later face loan collection.
Impact: Stolen identities used to obtain federal student aid refunds
- Countries
- United StatesKenya
From the original article
7 min read at arstechnica.com
Applying for FAFSA may get messy as DOJ “ghost student” crackdown ramps up.
By Ashley Belanger · arstechnica.com
A short excerpt; the article and its images belong to the publisher. Summary, key facts and assessment above are AI-written from the article and can be wrong.