DOJ Unveils Ghost Students Scam Indictments Against 5 People

Five people have been indicted, accused of stealing the identities of U.S. citizens to enroll “ghost students” in educational institutions across the country, to fraudulently claim Federal Student Aid (FAFSA) payments.The Department of Justice on Thursday unveiled details of federal indictments in Nebraska, Virginia, and New Jersey that came from Operation Ghostbusters, a nationwide investigation into student loan fraud linked to Kenya.Two Kenyan nationals were indicted in Nebraska and Virginia, and three people—George Mendez, Mabed Utate-Alberto and Patricia Perez—were charged in New Jersey for acting as “money mules,” opening bank accounts to send about $1.3 million to Kenya.One of the Kenyans had arrived after winning a Green Card in the “Diversity Visa” lottery, under the Biden administration, DOJ said.At a press conference to announce the indictments, Assistant Attorney General for the National Fraud Enforcement Division, Colin McDonald, said it was “organized fraud at scale.”“Investigators believe this fraud has been ongoing since at least 2021, potentially reaching several hundred million dollars lost,” McDonald said. “In California, nearly a third of community college applications submitted in 2024 were reportedly flagged as fraudulent.”DOJ, in its statement, said that the “ghost students” never attend the college classes for which those funds were awarded.“Instead, using super intelligence, fraudsters place ‘ghost’ or fake students in classrooms to keep federal student loan funds flowing,” it said. “Fraudsters even use super intelligence to complete required coursework at schools to maintain the ‘ghost student’ scam.”“If you steal American identities, if you steal taxpayer dollars, if you exploit programs meant to help students build a future, we will find you,” McDonald said. “Whether you are in Nebraska, New Jersey, Virginia, or Nairobi, we will pursue you.”“But lost dollars don’t complete the whole story,” McDonald said. “The complete story includes the plight of an American citizen.”The U.S. Department of Education building is photographed in Washington on Dec. 3, 2024. Jose Luis Magana/AP PhotoHe then explained that at least one U.S. citizen, who graduated from high school but never attended college, discovered their identity had been stolen and used to obtain a student loan.“His identity was stolen, his credit is now at risk, and his name is on the bill,” McDonald said.Mendez, Utate-Alberto, and Perez are accused of being involved in the scam between March 2021 and January 2026.After they received the FAFSA money, they would take their cut and transfer the remainder to an associate in Kenya, who allegedly ran a front company offering safari trips.On Oct. 19, a grand jury in Nebraska indicted Francis Mogambi on five counts of theft of government money and five counts of aggravated identity theft.Federal prosecutors alleged that between November 2025 and May 2026, Mogambi worked with accomplices in Kenya to steal the identities of U.S. citizens, and then enroll them as “ghost students” in U.S. colleges.After the fictitious students enrolled, Mogambi allegedly diverted their FAFSA payments to himself, keeping a portion and sending the rest to the gang in Kenya.‘Diversity Visa’ Lottery WinnerMogambi arrived in the United States on May 15, 2024, having won the “Diversity Visa” lottery and been issued a DV1 visa. He was later given a Green Card under the Biden administration.The Trump administration sought to pause the Green Card lottery after it emerged that a Portuguese national suspected of a shooting at Brown University, on Dec. 13, 2025, had come in on the scheme.Red Eagle Law, an immigration firm, challenged the pause.On Oct. 29, a U.S. Court of Appeals for the Ninth Circuit panel granted the Trump administration a stay on reopening the program.On Oct. 21, 2026, a federal grand jury in the Eastern District of Virginia returned an indictment against a fifth individual, an unnamed Kenyan national, who is accused of conspiracy to commit wire fraud and student aid fraud.According to the indictment, he used the same technique to steal $1.4 million of taxpayers’ money, using more than 700 fraudulently obtained FAFSA refund deposits.DOJ said $750,000 in cryptocurrency had been seized so far as part of the Operation Ghostbusters investigation.It was not immediately clear whether any of the five accused had legal representatives who could comment on their behalf.U.S. Under Secretary for Education, Nicholas Kent, said every dollar that falls into the hands of a fraudster is a dollar that does not go to a student in need.“Under President [Donald] Trump and Secretary [Linda] McMahon’s leadership, the Department of Education has saved taxpayers more than $2 billion in attempted student aid theft—ensuring students receive the critical funding they need, not fraudsters,” Kent said.Assistant Director Heith Janke, of the FBI’s Criminal Division, said personal data belonging to U.S. citizens was stolen to fuel a criminal enterprise.“The perpetrators masterminded a deliberate plot to defraud the U.S. government of millions of dollars through the exploitation of financial aid programs designed to help hardworking American students,” Janke said.“To date, the FBI has identified more than $32 million in losses, with millions more suspected, in similar ghost student schemes,” Janke said.Earlier this month, in an unconnected development, the Department of the Treasury’s Financial Crimes Enforcement Network said it had discovered $270 million in suspicious financial activity likely associated with student aid program fraud.