The Rise in Ghost Students: How Fraudsters Use Fake Identities to Enroll—and Cheat—Colleges and Universities
.png)
Ghost Students: The Growing Risk of Identity Fraud in Colleges and Universities
Fraudsters are heading back to school—and that can put educational institutions at risk.
Student load-related fraud has surged since 2020, increasing to $5 billion[1] . In California alone, millions of dollars in community college financial aid have been disbursed to students applying with stolen or fraudulent identities. Last year, the California chancellor’s office estimated 20 percent of community college applicants were bots, or 1 in 4 college applicants.[2] These fraudsters—ghost students—receive disbursed funds based upon a stolen or synthetic identity and never attend classes or use the funds for school-related expenses: In essence they take the money and run.
Why Ghost Students are on the Rise
The college application process has become easier and more accessible, which means that students can apply to, and be accepted by, more colleges than ever. While convenient for both students and institutions, the increase in remote learning also means that students no longer need to appear in person to attend classes or enroll in programs. At the same time, fraudsters are using bots to apply and register as students, particularly in online classes. This has created a perfect storm for scammers who see an opportunity to take advantage of educational institutions and reap significant financial rewards.
The rise in ghost students—fraudsters (and bots created by fraudsters) who present themselves as college applicants but who actually use fraudulent or stolen credentials to enroll—can be both costly and damaging for colleges and universities.
How Ghost Students Are Exploiting College Systems
The goal of these ghost students isn’t to attend classes or earn a degree, but to use this identity to pose as a legitimate student, allowing them to:
● Use their active student status to apply for financial aid, loans, or other funding for their personal, non-college related use, and then disappear.
● Take admission spots away from students who truly do want an education, as well as siphon resources away from the legitimate student population.
● Use their newly-assigned .edu email address or college VPN to take advantage of free college-provided cloud storage space or to perpetrate other scams.
In fact, the California State Chancellor’s office estimated that about 20% of California community college applications, more than 460,000, were fake.[3] The U.S. Justice Department also identified and indicted three people on enrollment fraud-related charges after they were found to be stealing the identities of prison inmates and other victims to falsely enroll in a community college to apply for and steal federal student loans totaling nearly one million dollars.[4]
With the increasing number of data breaches, as well as the availability of personal data on the dark web, fraudsters have a near infinite supply of personally identifiable information (PII) with which to apply to schools, enroll, and, ultimately, access resources and money.
The Costs of Ghost Students
In addition to the financial losses associated with dispersing financial aid to ghost students, colleges also suffer financially in other ways:
● Wasted resources, including allocating more time and staff to review applicants and applications, and monitoring student activity and attendance.
● Impact on enrollment, when ghost students take the spots of legitimate students and then fail to attend classes, or ghost students create the illusion of high demand for a course that the school then spends money to staff and create space for, only to discover they over-resourced for non-existent students.
● Diminished educational opportunities and experiences for real students, who can have enrollment spots, classes, and resources taken by ghost students, and who lose out on the opportunity to attend college or take the classes needed to advance in their chosen field
What Can Be Done about Enrollment Fraud?
Enhancing identity verification is vital to finding and stopping ghost students. Colleges and universities are adopting, out of necessity, sophisticated technologies to detect and deter fraudulent student activities tied to fake IDs. These schools can leverage advanced identity verification to discover fraudsters during the application process and prevent ongoing fraudulent activity, without creating a frustrating application process that discourages real students. Even during the application process itself, an identity verification platform should be able use the scanned barcode data from the applicant’s ID to pre-fill the relevant blanks on application forms, ensuring that the information is 100% accurate by eliminating typos and mistakes from illegible handwriting – mistakes that can make the application process longer and require more manual intervention to resolve.
The key is to rely on an identity verification service that prevents ID-related fraud by accurately and quickly proving an applicant’s identity, in real time, so schools don’t have to rely on manual, time-consuming, and error-prone methods.
Intellicheck: Facing the Academic Enrollment Challenges
As the only identity verification platform that uses a unique and proprietary analysis of government-issued IDs, Intellicheck creates trusted, real-time student identity verification experiences—today.
The Intellicheck approach to identity verification serves as a model for educational institutions facing higher fraud risks (online, remote), enabling them to mitigate risk and strengthen overall student fraud prevention efforts. Intellicheck helps prevent ghost students before they access educational and financial resources, and improves the accuracy of the application process by using the scanned ID barcode data from the person's ID to fill application forms and ensure they are easy to scan and verify during the review process.
Discover how Intellicheck is stopping ghost students and helping colleges and universities reduce the risk of fraudulent applications and enrollments.
Request an Intellicheck demo today.
[1] Forbes
[2] CalMatters
