📺 Stream EntrepreneurTV for Free 📺

California Colleges Are Flooded With 'Ghost Students' Attempting to Steal Financial Aid About 20% of applications for California community colleges are fraudulent, according to the State Chancellor's Office.

By Madeline Garfinkle

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

Joseph DeSantis | Getty Images
Richard Valicenti, a radiation oncologist at UC Davis, is one of the thousands who have had their identity stolen to create fraudulent student applications with the intention to steal federal aid.

Richard Valicenti, 64, received an out-of-the-ordinary check in the mail last summer. It was $1,400 for a Pell Grant to attend Saddleback College in Orange County, CA. Valicenti, a radiation oncologist at UC Davis, was well-beyond his college years and also had "never heard" of the college he was allegedly attending and getting federal aid for, the San Francisco Chronicle reported.

While Valicenti was perplexed, college admissions directors and administrators are all too familiar with the situation. Valicenti's identity had been stolen by criminals attempting to receive financial aid by creating bogus college applications — a practice that has resulted in an unprecedented influx of "ghost students."

Ghost students are essentially bots created by fraudsters that take advantage of the application system in hopes of receiving government aid.

About 20% of California community college applications are fictitious, according to the state Chancellor's Office, per The Chronicle, and may be an easy target for criminals as community colleges in the state do not require a social security number to apply and are required to accept any applicant with a high school diploma.

The rise in ghost students has surged since the pandemic, due to online classes which made it easier for ghost students to go under the radar, as well as the U.S. Department of Education's decision to stop verifying household income in the wake of a national crisis — an initiative that is expected to remain in place until the next award cycle.

Related: California Woman Arrested For $60 Million Postal Service Scam

City College of San Francisco reported 59 fraudulent students to the chancellor's office this spring alone, and has identified 29 ghost students who have received $22,418 in Pell Grants to date, officials told the outlet.

"It is a 100% disservice to every single taxpayer," Kim Rich, a criminal justice instructor at L.A. Pierce College told the outlet. "These criminals wouldn't still be doing this if they weren't getting the money."

Rich said that after instructors cleared out ghost students, spring enrollment at Pierce dropped from 7,658 to 4,937.

In March, the U.S. Justice Department arrested three women in Los Angeles for allegedly stealing inmates' identities to falsely enroll in California colleges and steal federal aid. From January 2012 to August 2017, the women allegedly stole about $1 million in student loans.

"As a result of their alleged scheme, the defendants fraudulently caused the United States Treasury to disburse approximately $980,000 in FSA funds on behalf of straw students," the U.S. Attorney's Office said in the press release.

Related: 3 Arrested on Felony Charges for Allegedly Perpetrating a $4 Million 'Substantial Food Stamp Fraud Ring' With Stolen Data

Madeline Garfinkle

News Writer

Madeline Garfinkle is a News Writer at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Starting a Business

Most People Have No Business Starting a Business. Here's What to Consider Before You Become an Entrepreneur

You need to find the right business opportunity at the right time and take the right steps to beat the odds.

Leadership

AI vs. Humanity — Why Humans Will Always Win in Content Creation

With the proliferation and integration of AI across organizations and business units, PR and marketing professionals may be tempted to lean into this new technology more than recommended.

Growing a Business

Who You Hire Matters — Here's How to Form a Team That's Built to Last

Among the many challenges related to managing a small business, hiring a quality team of employees is one of the most important. Check out this list of tips and best practices to find the best people for your business.

Leadership

This Leadership Technique is the Secret to Optimal Team Performance

Through my experience in business, I've found one particular leadership technique that works better than others.

Management

7 Ways You Can Use AI to 10x Your Leadership Skills

While technology can boost individual efficiency and effectiveness, it's essential to balance their use with human intuition and creativity to avoid losing personal connection and to optimize workplace satisfaction.

Business News

Passengers Are Now Entitled to a Full Cash Refund for Canceled Flights, 'Significant' Delays

The U.S. Department of Transportation announced new rules for commercial passengers on Wednesday.