What Is FAFSA Fraud, and Why Is Congress Working to Stamp It Out?
Johanna Alonso
June 22, 2026
So-called ghost students have been stealing financial aid for at least a decade. Now the Department of Education and Congress are trying to curb the schemes.
Earlier this month, the House of Representatives passed the No Aid for Ghost Students Act, which would require the Department of Education to screen federal aid applications for potential fraud in response to schemes that costs colleges and universities millions of dollars annually.
The legislation, sponsored by Republican Rep. Burgess Owens of Utah, would essentially codify an initiative the department had already launched independently this spring. Dubbed “Real-Time Fraud Detection,” the new Free Application for Federal Student Aid feature screens all applicants in what financial aid experts have called a major win for institutions that have been fighting these schemes alone for years.
