(WJAR) — Students are rushing to apply for financial aid ahead of Monday’s FAFSA deadline – but they’re not the only ones.
Artificial intelligence-powered bots are stealing millions in federal student loans, according to cybersecurity company Avast.
“Cybercriminals are combining stolen identities with AI-driven bots to create what we call ‘ghost students,’ who actually enroll in these online programs long enough to collect this financial aid and then they disappear,” explained Iskander Sanchez-Rola, director of AI and innovation at Avast.
How big is the problem?
A recent investigation by the Associated Press found 1.2 million fraudulent applications at California community colleges in 2024 alone.
Those fraudulent applications resulted in more than 200,000 suspected fake enrollments and $11.1 million dollars in unrecoverable aid losses.
But it’s not just money students are losing out on.
Sanchez-Rola said many of these students are also having their identities stolen in the process.
He said it’s another reason why you’ve got to guard your personal information closely.
“Guard your personal information like it’s gold,” said Sanchez-Rola.
He continued, “Also be cautious of social media – fraudsters definitely mine public posts for personal details to build these convincing fake identities.”
Avast also recommends students monitor their credit reports, and freeze their credit.
Parents of younger kids should also place a freeze on their children’s credit until it’s time to start applying for aid.
