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US student-aid fraud investigation leads to five indictments, authorities say
US authorities say an investigation into alleged student-aid fraud has produced five indictments, with 40 more investigations open and hundreds of people affected by alleged identity theft.
US authorities say a student-aid fraud investigation has resulted in five indictments, while 40 further investigations remain open. Hundreds of people have been affected after their personal information was allegedly stolen and used to obtain federal student aid.
Assistant Attorney General Colin M McDonald, head of the Justice Department's National Fraud Enforcement Division, vowed to pursue those involved at an Oct. 29 news conference announcing the investigation's first charges.
The Justice Department says those behind the fraud place fictitious students in classrooms and complete coursework to make it appear that they are attending college, allowing financial aid payments to continue.
Investigators identified 830,840 potentially fraudulent Federal Student Aid identification numbers associated with nearly $130 million in September and October 2026. They recommended that the Department of Education disable those identification numbers.
That amount represents financial aid associated with potentially fraudulent accounts. It does not represent confirmed losses.
People whose identities are stolen can face unexpected student-loan debts even if they have never enrolled in college.