From Fox News: A top Trump administration Education Department official exposed a pair of blue states that he says are among the worst for federal student aid fraud as officials crack down on scammers who are exploiting the taxpayer-funded programs.
In 2025, the Department of Education said it prevented $1 billion of fraud in the aid programs. Under Secretary of Education Nicholas Kent said these schemes are not only a waste of taxpayer money, but also disproportionately affect low-income students trying to pay for their education.
“We talked about California being certainly a hub of fraud, waste and abuse, but we also see Minnesota, for example,” Kent told Fox News Digital. “You know, one of the things that has been brought to light over the course of the last couple of weeks is the enormous amount of fraud, waste and abuse under the governor’s leadership there, and this is something that the federal Department of Education had lifted up and highlighted months ago.”
“And to kind of put that into perspective, that’s 1,700 Pell Grants for low-income students that that money could have gone toward,” Kent continued. “So when we think about limited resources, we think about taking away these things that low-income and middle-income students really need in order to get in and through their educational journey.”
The report explains that a whopping 34% of applications to community college in California last year were likely fake, and at least $10 million in federal financial aid was stolen from community colleges in the state just during the 2024-2025 school year.
Kent explains that much of the fraud comes from “ghost students” who simply sign up for the college courses to get the financial aid, show up for classes a couple times, then are never seen again.
He also noted that the scammers now use AI to enroll in many different college programs all at once – a scheme that is committed not only by Americans, but by thieves from abroad as well.
“And so, over the summer, we implemented very strict fraud controls on the FAFSA, the form that students use to apply for federal student aid, including mandatory identification checks for first-time student aid applicants, to ensure that every applicant is a real student and not a ghost student or an AI bot,” Kent said.
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