Colleges Crack Down On ‘Ghost’ Students Exploiting Financial Aid

Beginning in 2022, professors at Chaffey College began noticing that their virtual classes were filled with students turning in identical assignments all at once. 

“We would notice it because a math class would have one or two students involved one day and then the next day, it’d be full,” says administrative systems director Bryce Prustos. “Same homework, same answers, at the same time.”

When Prustos checked the systems, these so-called “students” even had identical addresses and bank account numbers, he says. 

These AI-generated ‘ghost’ students were most likely created by one of the many highly organized cyber criminal networks that flood college enrollment systems every year. When undetected, these ‘ghost’ students have defrauded the financial aid systems out of tens of millions of taxpayer dollars. 

The education sector experiences far more cyberattacks than any other industry worldwide. In the first six months of 2025, the industry saw 4,356 average weekly attacks per organization worldwide, per Check Point Cyber Technologies’ latest data.

It’s only getting worse. Globally, there was a 41 percent year-over-year increase in cyber attacks on educational institutions, and the ones in North America saw a 67 percent increase. 

“It’s clear they’re kind of zoning in on this,” says Aaron Rose, Check Point’s Security Architecture Leader. “AI is really adding fuel to the fire.”

Obviously, there’s huge money to be made from cyphoning federal COVID-19 relief grants and financial aid, but simply obtaining an email address that ends with .edu can lend huge credibility to other scams. 

“At first glance, it’s a bit more trusted,” Rose says. “Because that .edu address essentially establishes some sort of authority, and then from there, you know, there are so many different scams that you can watch.”

Generative AI has given scammers the tools to send out thousands of custom professional-sounding emails to alumni or industry professionals by simply inputting the information from their LinkedIn. The other day, a sales executive at Stripe actually tricked one of these LLMs into sending him a recipe for flan instead of a fraudulent recruitment email. 

To boot, these scammers can send these personalized emails eliciting donations for a scholarship fund or a faculty gift from [name]@school.edu. 

Access to thousands of student emails from a school directory is also a big draw for online scammers. Cyber criminals have long weaponized the student debt crisis to con desperate young people out of money by impersonating student loan officials and university financial aid officers. Former Forbes 30 Under 30 star Charlie Javice was accused of this by Congress before her legal woes with JPMorgan Chase. 

In particular, the community college system’s dedication to accessibility for its students is precisely what makes it so vulnerable to fraud. Automatic enrollment is essential to community colleges like Chaffey. 

“We don’t wanna create barriers,” Prustos says. “When the fraud started, a lot of colleges’ ideas were to make everything manual… but, you’re doing the student a disservice at that point.”

“They’re meant to be a community resource,” says Fortune magazine editor Amanda Gerot. “Fraudsters know that, and they’re exploiting that by the way that they’re flooding those systems.”

Chaffey now has an advanced anti-fraud system in place that balances its accessibility needs.

“Even if, you know, a university or school, maybe they require, I don’t know, a Zoom meeting or something with your admission counselor or whatever it might be, that can still be faked pretty easily,” says Rose, who confirmed that deepfake tech has been around for some time and it’s only gotten more advanced. 

About 17 percent of hiring managers surveyed by Resume Genius admit they’ve encountered candidates using deepfake technology to alter their video interviews. It’s estimated that 1 in 4 job candidates worldwide will be fake by 2028, according to research and advisory firm Gartner.

Scammers are continuously outpacing the safeguards created by IT specialists and cybersecurity experts, like Prustos and Rose.

“It’s kinda like we’re playing back and forth with them,” says Prustos. “Once we figure something like that out, then they’ll get smarter about it.” 

Over the Summer, Secretary of Education Linda McMahon announced a nationwide effort to ramp up the student identification verification process to prevent identity theft fraud. However, as the Trump administration moves to dismantle the Education Department, efforts to pursue the cyber criminal enterprises behind this fraud could be sidelined. Many of these organizations operate overseas and require FBI involvement to track down and extradite.

The low rate at which people report cyber crimes is also an issue.

“If we look at the amount of people that actually report a cyber crime or a scam to the FBI, it’s much slower,” Rose says. “Some people are just embarrassed, or they think, ‘oh, they’re not going to do anything’… [but] if you don’t report it, nothing is going to happen.”

Rose has worked with the FBI on cyber crimes in the past and says that even small-scale online scams can lead law enforcement to major cybercrime organizations.

If you suspect you’ve been the victim of a scam, please report it to the FTC or the FBI.