“Ghost students” present new threat to community colleges

Digital thieves who steal identities to enroll fake students at community colleges, secure Pell grants and federal loans, then disappear with the money (0:08). This scheme exploits the open enrollment policies of community colleges and the shift to online learning during the pandemic.

Federal investigators currently have about 200 open investigations nationwide (1:52), with losses ranging from hundreds of thousands to over a billion dollars. One institution found that 33-34% of enrolled students were fraudulent (7:58).

The shift to online learning during COVID-19 opened the door for this fraud by removing in-person verification requirements (1:38). Criminals now use AI to generate applications and enroll long lists of stolen identities simultaneously (2:07).

Victims discover the fraud through credit score drops, unexpected debt notices from the Department of Education, or when applying for legitimate financial aid (0:30). The ABC correspondent Gio Benitez saw his credit score drop 250 points overnight (5:05).