Applying for federal student aid is a rite of passage for millions of students each year. But as deadlines approach, a new threat is emerging—one that’s powered by artificial intelligence and putting both money and identities at risk.
Imagine this: You’ve spent months preparing your Free Application for Federal Student Aid (FAFSA), only to find out that someone else has used your information to claim your financial aid. This isn’t just a hypothetical scenario. According to cybersecurity experts at Avast, AI-driven bots are now being used by cybercriminals to create fake student profiles—so-called "ghost students"—who enroll in online programs just long enough to collect aid and then vanish without a trace.
The scale of the problem is staggering. A recent investigation found that in 2024 alone, California community colleges received 1.2 million fraudulent applications, resulting in over 200,000 suspected fake enrollments and more than $11 million in unrecoverable aid losses. But the financial impact is only part of the story. Many real students are also having their identities stolen in the process, leading to long-term headaches with credit and personal security.
So, how are these scams happening? Cybercriminals are combining stolen personal information with sophisticated AI bots to automate the application process. They mine social media and public records for details, then use bots to fill out and submit applications at scale. The result: a flood of fake students that’s difficult for schools and the government to detect in time.
What Can You Do to Protect Yourself?
- Guard your personal information like it’s gold. Be cautious about what you share online, especially on social media, where fraudsters often look for details to build convincing fake identities.
- Monitor your credit reports regularly. Look for any unfamiliar activity or accounts, and report anything suspicious immediately.
- Freeze your credit if you’re not applying for loans or new credit cards. This makes it much harder for anyone to open accounts in your name.
- Parents: Freeze your children’s credit. Kids are prime targets for identity theft because their credit histories are clean. Keep their credit frozen until it’s time to apply for aid.
If you suspect your identity has been stolen, act quickly. Report the fraud to the authorities, freeze your credit, and keep a close eye on your accounts.
Summary of Key Points:
- AI bots are being used to steal millions in federal student aid through fake applications.
- Students risk both financial loss and identity theft.
- Protect your information by being cautious online and monitoring your credit.
- Parents should freeze their children’s credit to prevent early identity theft.
- Act fast if you suspect fraud to minimize damage and recover your identity.
Staying vigilant and proactive is the best defense against these evolving scams. By taking a few simple steps, you can help ensure your financial aid—and your identity—stay safe.