The Department of Justice announced the first indictments in a sprawling investigation into an elaborate student aid fraud scheme that authorities say has bilked taxpayers of hundreds of millions of dollars.
At an Oct. 29 news conference unveiling “Operation Ghostbusters,” which aims to crack down on the international fraud scheme, federal officials described how suspects steal Americans’ identities to create “ghost students” before applying to universities and receiving federal student aid.
Assistant Attorney General Colin McDonald said perpetrators use artificial intelligence to fill out applications and complete coursework “so it looks like the ghost student” is attending classes. Some go as far as creating “the appearance of a fake student in an online classroom to trick schools into believing a real person is present,” he added.
The government’s sprawling operation involves multiple federal agencies, including 26 FBI field offices and more than 20 U.S. attorney’s offices across the country. There are 40 open cases related to the international scheme, McDonald said.
“This is organized fraud at scale,” McDonald said. “Investigators believe this fraud has been ongoing since at least 2021, potentially reaching several hundred million dollars lost.”
“In California, nearly one-third of community college applications submitted in 2024 were reportedly flagged as fraudulent,” he added.
Reporting by Christopher Cann, USA TODAY / USA TODAY
USA TODAY Network via Reuters Connect
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