By Mark Pribish | Founder at IDentity Theft Brokers, LLC
In this June 22, 2026 article titled Understanding the Crackdown on FAFSA Fraud, ghost students have been stealing financial aid for at least a decade. Now the Department of Education and Congress are trying to curb the schemes.
With scammers posing as fake or “ghost” students and having stolen millions in federal student aid, the House of Representatives passed the No Aid for Ghost Students Act, which would require the Department of Education to screen federal aid applications for potential fraud in response to schemes that costs colleges and universities millions of dollars annually.
When ghost students use stolen identities to apply for federal aid and loans, they take the money and disappear.
For those individuals unfamiliar with the phrase ghost students, these students are fully fabricated identities, sometimes based on stolen personal information, sometimes entirely synthetic, created to fraudulently enroll in colleges. Fraudsters use AI tools to generate admissions essays, forge transcripts, and even produce deepfake images and videos for identity verification.
Unfortunately, ghost student fraud is more than a financial threat, it is a systemic risk to educational access. With AI-enabled fraud growing in sophistication, higher education must act decisively to safeguard the integrity of enrollment, financial aid, instruction, and student support systems.
Financial aid fraud can be costly for universities, which must pay the stolen money back to the federal government. The scams also leave the individual whose identity was stolen with debt, a damaged credit score and difficulty securing real financial aid in the future.
So why is this emerging ghost student fraud happening now? According to Jason Williams, the assistant inspector general for investigations at the U.S. Department of Education’s Office of Inspector General, “fraudsters have attempted to steal student financial aid for decades but when the pandemic hit, everybody went to online learning that opened the door for more widespread fraud.”
Since that time, ghost students have been stealing identities with estimates of college applicant pools ranging from 20% to 30% of fraudulent or synthetic applications.
And as you might imagine, ghost students are not just individuals with a computer and hoodie in the basement of their home, but instead are comprised of ID theft criminals, scammers and fraud networks taking advantage of technology, automation, and AI.
But there is more as educational data is being stolen and sold on the dark web every day generating millions of dollars for cyber thieves and ID theft criminals. Here are four reasons why the education sector is such a high-level target:
- Financial Aid – Social Security Numbers and financial aid data are included on the Free Application for Federal Student Aid (FAFSA®) form.
- Student Records – Personally Identifiable Information (PII) and academic records are valuable targets for identity thieves and fraudsters.
- Research Universities – are at the leading edge of innovation, and the theft of proprietary research data has a financial and competitive impact.
- Alumni/Donor Information – alumni and donor information can be targeted for phishing and social engineering scams.
And it gets worse as ID theft criminals and fraudsters are not only targeting the education sector but are targeting individual students of all ages based on risky online behavior.
Since nearly every student today has a laptop and smartphone along with access to multiple social media platforms, scammers and fraudsters are targeting the risky behavior of students.
Risky behavior examples include students misusing social media, using fake websites that appear to be legitimate educational websites, and blogs that can create the potential for dangerous interaction with other students such as bullying to child predators. This risky online student behavior can also negatively impact the mental health of teens and young adults.
With a significant increase in phony Facebook, Instagram, TikTok, and Snapchat profiles, along with numerous “fake” friend requests, many students are at risk of cybercriminal scams and fraud.
So what can parents and students do to mitigate their exposure to cyber scams and identity theft?
Parents and students should increase their education and awareness about online threats such as the Phishing (fraudulent emails), Vishing (fraudulent phone calls and voice mail messages) and Smishing (fraudulent text messages) tactics used by hackers and identity theft criminals.
Parents and students need to know “student rights” under FERPA (The Family Educational Rights and Privacy Act (FERPA)) which is a federal law that protects the privacy of student education records.
Since college students are prime targets for identity theft, fraud, and scams, here are four action items to consider:
- Use a virtual private network (VPN) to securely surf the web
- Use a password manager versus weak, reused, or compromised passwords
- Reconsider the data you share on social media
Just as the internet connects families and children to support education and educational resources, identity theft criminals and cyberthieves are always looking for new ways to “connect” with you and your family.
About Mark Pribish: Mark Pribish is the Founder at IDentity Theft Brokers. Mark is nationally recognized as a digital security and identity theft risk management expert. He is known for his long-running coverage of identity theft trends and prevention, cyber security best practices, and data breach risk management issues.
