Thousands of “ghost students” use AI to steal millions in student loans, DOJ says
Summary
The Justice Department charged five people in a federal investigation into a scheme that used stolen identities and AI to obtain student aid for fake college students. Officials said investigators identified more than 830,000 potentially fraudulent aid accounts and tied over $32 million in actual losses to the people charged.Key Facts
- The Justice Department said the scheme used stolen personal information to apply for federal student aid in Americans’ names.
- Fraudsters allegedly enrolled fake students at colleges and received aid refunds after schools deducted tuition and fees.
- Officials said perpetrators used AI to complete applications and coursework and to simulate attendance in virtual classes.
- The Education Department identified more than 830,000 potentially fraudulent federal student aid accounts created with stolen U.S. citizens’ information.
- If all of those accounts were fraudulent, the Justice Department estimated losses could approach $130 million.
- Investigators linked more than $32 million in actual losses to the people charged and said the total could be higher.
- The Justice Department said it seized more than $750,000 in cryptocurrency from a network associated with Kenyan nationals.
- In one example cited by the department, a defendant received about $1.44 million through more than 700 fraudulent student aid refund deposits.
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