Federal prosecutors announced charges against five defendants Thursday in an investigation of ghost student aid fraud and student-aid fraud that allegedly used stolen American identities to obtain money meant for college students.
The Justice Department said its Operation Ghostbusters cases span Virginia, New Jersey and Nebraska. Investigators also seized more than $750,000 in cryptocurrency tied to the alleged network, according to the department’s Oct. 29 announcement.
What prosecutors allege
Understanding Ghost Student Aid Fraud
Authorities say participants used stolen identities to create federal student-aid accounts and enroll people who were not genuine students. After schools issued refunds from aid disbursements, money allegedly moved through accounts controlled by intermediaries in the United States and overseas.
The department described the charges as the first results of a wider investigation. Its announcement does not establish that any Utica-area college or resident was affected.
The defendants are presumed innocent unless proven guilty. Charges and prosecutors’ descriptions of the alleged scheme are not court findings.
Help for people whose identities were used
Students are not the only people who need to recognize this kind of fraud. An unexpected student-loan notice can deserve attention even if the recipient never applied for college aid.
The Education Department’s Office of Inspector General advises people who believe someone obtained federal aid in their name to contact their loan servicer, alert the credit reporting agencies and freeze their credit, share the information with the OIG, and file an identity-theft report with the Federal Trade Commission.
The FTC’s recovery guidance also directs victims to contact the school or program that opened the loan. It recommends keeping records of calls, letters and other efforts to resolve the problem.
Those steps are general agency guidance, not a determination that a particular account is fraudulent. Anyone receiving an unfamiliar notice should verify it directly with the named school or loan servicer rather than relying on links or phone numbers supplied in a suspicious message.
