Justice Department Unveils First Operation Ghostbusters Indictments in 'Ghost Student' Aid Fraud Tied to Kenya

What happened

On Thursday the Justice Department's new fraud unit and three U.S. Attorney offices revealed the first charges from Operation Ghostbusters ^[1]. Investigators say criminals took real Americans' personal data to open bogus aid applications in their names and sign up "ghost students," then sent the refund money abroad with help from domestic go-betweens, among them people from Kenya ^[1]. The charges are allegations, and all defendants are presumed innocent until proven guilty ^[1].

How it affects Americans

The scheme hits taxpayers who fund federal aid and ordinary people whose names were stolen ^[1]. The release says many known victims "have reported attaining only high school diplomas" and were shocked to learn of faked attendance far from home ^[1]. Assistant Director Heith Janke of the FBI said the bureau "has identified more than $32 million in losses, with millions more suspected, in similar ghost student schemes" ^[1]. Anyone who believes they are a victim is urged to file a report through the Education inspector general's online hotline form at oig.ed.gov/oig-hotline/complaint-form, and people who got an FBI letter should follow its instructions ^[1].

The Veil Press view

Aid programs built on trust need verification that keeps up with organized fraud, and Americans deserve to know their identities are protected ^[1]. "The Department is charging five defendants and announcing the seizure of more than $750,000 in cryptocurrency tied to this scheme through a network associated with Kenyan nationals," said Assistant Attorney General Colin M. McDonald ^[1]. Nicholas Kent, an under secretary at the Department of Education, claimed it "has saved taxpayers more than $2 billion in attempted student aid theft," a figure attributed to him ^[1].

What we know

Confirmed

• In New Jersey, three alleged money mules were arrested on a criminal complaint in a case with a $1.5 million intended loss ^[1].
• In Virginia, a grand jury returned a sealed multi-count indictment against a Kenyan national, alleging about $1,439,548 in refund deposits ^[1].
• In Nebraska, Francis Mogambi, a Kenyan citizen, faces a ten-count indictment on theft of government money and aggravated identity theft ^[1].
• Investigators flagged 830,840 potentially fraudulent FSAIDs tied to nearly $130 million and urged that they be shut off ^[1].
• The release says there are more than 40 open cases across 26 FBI field offices ^[1].

Still being reported

• The release estimates the fraud "well over $200 million," and says two Kenya-based co-conspirators may be charged later ^[1].
• McDonald called the seizure "the first international seizure of its kind in Kenya"; elsewhere the release says it is a first in the Fraud Division's history ^[1].