Utah Colleges Lost $834,000 to Enrollment of ‘Ghost Students’
“Limited information sharing and the absence of formal system-level response hindered detection of fraudulent activity.”
This is probably happening in almost every state. Imagine the losses.
The College Fix reports:
Utah colleges lost $834,000 to ‘ghost student’ enrollment fraud: report
Utah’s higher education system lost over $830,000 in recent years to “ghost students” who apply only to receive financial aid and run off with the money without pursuing a degree.
“Institutions reported disbursing $834k to suspected fraudulent applicants and spending over 15,000 hours working to mitigate enrollment fraud,” according to the Utah Legislative Auditor General’s 2026 Performance Audit on Enrollment Fraud in Higher Education.
Salt Lake Community College alone saw at least 2,000 fraudulent applications in recent years.
The report also states that “Limited information sharing and the absence of formal system-level response hindered detection of fraudulent activity.”
Nick Varney, senior audit and operations supervisor in the Utah State Legislature, told The College Fix via email that fraudsters enroll in virtual classes and then, “maybe complete some introductory coursework, probably using artificial intelligence.”
“And then the moment that the aid is dispersed, then you see the student drop off,” he said, adding that Utah saw a rise in ghost student applications in 2025 and 2026.
Varney also said that the average person, including university students themselves, don’t seem aware of this issue.
Asked about what can be done to mitigate this problem, Varney highlighted two solutions that have worked well for Utah State University.
When USU saw a rise in applications on a certain weekend, it “immediately shut down the application.”
“They shut down their system, they met with their leadership and got everyone on board to understand what the problem was and what solutions and what internal controls were gonna be needed in order to have more robust processes to ensure that fraudulent applications weren’t getting through,” he said.
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Comments
A simple way to minimize the loss would be for the financial aid to go directly to the college. If the aid is for tuition then the college could simply subtract the aid from the tuition. If the aid is for room and board the aid could be subtracted from dormitory charges or doled out monthly for off-campus housing. Similarly, board could be subtracted from the charges for college-supplied cafeteria food or doled out monthly for off-campus food. The cost of administering this system could also be minimized through the use of direct deposit banking or the issuance of debit cards to students.
Agreed! Any financial aid I received was given directly to the institution and then they cut a check to me for any excess funds (if there ever were any). I think I received a check once for $22.00!
Hopefully, you didn’t spend it all in one place.
At my institution, the financial aid is disbursed by the college. Tuition is paid first, then the student can use excess money for textbooks, then any overage is disbursed to the student.
I thought it always went straight to the U. That is why it’s a farce when they say “he borrowed all this money [that he never touched]”
And of course the language bias is present, as always.
Did the Utah school lose that money? They lost “paid reservations for a student slot which they couldn’t resell.” Close, but not the same thing.
Who really lost that money? The US Taxpayer.
I hate that unruly student aid that has to be “dispersed” – do the dollars gather in some disorderly way? Who reads them the Riot Act?
Maybe if the funds were disbursed in an orderly fashion they could be audited more closely and accurately.
That sort of issue arises only if it’s reigning money.
Ghost students, and being dead, they will most certainly vote democrat.
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