BUZZ
Investigators estimate that fraudsters have stolen approximately $200 million
The U.S. Department of Justice has charged five scammers for conducting a transnational “ghost student” scheme after millions of dollars were siphoned from federal financial aid programs.
“Operation Ghostbusters is a nationwide investigation into a large‑scale student‑loan fraud scheme in which criminal actors created fraudulent Federal Student Aid (FAFSA) accounts using stolen U.S. citizen identities to enroll ‘ghost students’ in educational institutions,” the department announced in a Thursday news release.
“Ghost students” are fake or stolen identities used by online scammers to enroll in college courses and steal financial aid awards.
Foreign scammers stole college financial aid money by sending the cash to local helpers in the U.S., who then wired the funds out of the country to the criminals’ accounts.
“The Department is charging five defendants and announcing the seizure of more than $750,000 in cryptocurrency tied to this scheme through a network associated with Kenyan nationals,” Assistant Attorney General Colin McDonald of the Justice Department’s National Fraud Enforcement Division said.
Three people in the U.S. worked with scammers in Kenya from 2021 to early 2026 to steal more than $1 million in federal student aid.
They used fake college aid applications with stolen American identities. The money went into their U.S. bank accounts. After taking a cut, they sent the rest to Kenya, tied to a fake safari company.
The three domestic criminals have been arrested, and prosecutors plan to charge the two fraudsters still in Kenya.
“If you steal American identities, if you steal taxpayer dollars, if you exploit programs meant to help students build a future — we will find you. Whether you are in Nebraska, New Jersey, Virginia, or Nairobi, we will pursue you,” McDonald said.
Investigators estimate that fraudsters have stolen approximately $200 million through “ghost student” schemes, with $32 million currently identified.
Earlier this year, the Trump administration announced a new financial aid tool that is projected to save taxpayers $1 billion by stopping “ghost student” fraud, The College Fix previously reported.
Experts have raised concerns about the growing issue of ghost students for several years. The issue has been particularly pronounced in California community colleges, but Minnesota universities have also grappled with it.
Utah’s higher education system lost more than $830,000 to ghost students in recent years, with Salt Lake Community College alone logging at least 2,000 fraudulent applications.
