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The US Justice Department uncovered an international ghost student fraud network in which criminal groups stole identities to apply for grants and loans, involving more than $200 million. Over 830,000 suspicious accounts were identified and many were prosecuted.
AmericaMinistry of Justice A nationwide “ghost students” fraud case was announced a few days ago, and criminal groups are suspected of embezzlementAmerican citizen Using their identities, they registered at universities and community colleges under false names, fraudulently obtained federal grants and student loans, and even used artificial intelligence (AI) to complete coursework, allowing fake students who had never attended classes to continue receiving subsidies. Authorities estimate the scale of the related fraud at more than 200 million yuan, and more than 830,000 suspicious student aid accounts have been identified. Five people were prosecuted or charged criminally.
The Justice Department joined with Virginia,new Jersey And the U.S. Attorney’s Office in Nebraska announced the first results of Operation Ghostbusters, which exposed an international fraud network spanning the United States and Kenya.
According to the Department of Justice, the suspects stole personal information of US citizens, used the victims’ identities to create federal student aid accounts, and applied for grants and loans from universities and community colleges through the Free Application for Federal Student Aid (FAFSA). These “ghost students” never actually attend classes, but scammers use AI to complete assignments and maintain their student eligibility. After the school distributed the financial aid and returned it, the money went to a bank account controlled by the criminal group and then sent to Kenya through a capitation account in the United States.
Some of the victims had only a high school education and had never attended college, but they found themselves registered under false names in schools hundreds of miles away.
The Justice Department said the scam began at least in 2021. The FBI has confirmed that similar cases have resulted in losses of more than 32 million yuan, and the total fraud scale is estimated to exceed 200 million yuan. From September to October this year, investigators discovered 830,840 suspicious student aid accounts, containing approximately $130 million, and recommended that the Ministry of Education deactivate them. Currently, 26 FBI field offices across the United States and more than 20 federal prosecutors’ offices are involved in the investigation, investigating more than 40 cases.
The first wave of cases involved three states. A Kenyan defendant in Victoria was suspected of receiving more than 700 fraudulent scholarship refunds, totaling approximately $1.44 million, of which at least $1.3 million was transferred to other accounts in the United States and Kenya.
Three defendants in New South Wales, Mabed Patricia Utate-Alberto, Patricia Arisaledi Perez and Jorge Arturo Alfau Mendez, are suspected of colluding with Kenyan associates from 2021 to fraudulently obtain more than 1 million yuan in student aid, and after cutting the commission, wired the money to associates belonging to Kenyan tourism companies.
Kenyan defendant Francis Mogambi of Nebraska was suspected of registering a school under his false name, fraudulently obtaining approximately 20,000 yuan in scholarships, keeping 30% of the stolen funds for himself, and sending the rest to his Kenyan associates. Court documents show he once revealed he was making $2,000 a week from the scam. He entered the United States through the Green Card Lottery Program in 2024 and later received a green card. He is currently detained awaiting trial.
The Justice Department said that US law enforcement officials worked with Kenyan police in September this year to seize more than $750,000 in cryptocurrencies belonging to the fraud network.
The FBI has sent notification letters to some victims whose identities have been fraudulently used. The Department of Justice calls on those who suspect that their personal information has been used to make false scholarship applications to report it to the Department of Education’s Office of Inspector General. People who receive an FBI notification letter should follow the instructions in the letter to contact the relevant entities.
Summary FAQ
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Criminal groups use US citizen identities to create student aid accounts, falsely apply for university and community college grants through the FAFSA, and use AI to write courses to maintain their enrollment status, allowing people who have not taken classes to continue receiving money.
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Authorities estimate the total amount of fraud to exceed 200 million yuan. The FBI has confirmed the loss of more than 32 million yuan and found 830,840 suspicious student aid accounts, containing approximately 130 million yuan. It has recommended that the Education Ministry deactivate them.
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The first wave of cases covers Victoria, New Jersey and Nebraska, and includes Kenyan affiliates and major US accounts. Five people have been convicted or charged criminally, and federal and Kenyan police also cooperated in seizing the cryptocurrencies.
