With each new day, it seems we are uncovering more fraud schemes costing the taxpayers millions, even billions. It's all growing very tiresome, but better we find them than not.
The latest such, uncovered by the Treasury Department, involves as much as $270 million in suspicious financial activity tied to federal student loan programs.
The Treasury Department has identified approximately $270 million in suspicious financial activity potentially linked to fraud targeting federal student aid programs, the agency told FOX Business exclusively.
Treasury’s Financial Crimes Enforcement Network (FinCEN) has referred the findings to federal investigators for further review. The referrals are part of the Trump administration’s broader effort to combat fraud and protect taxpayer dollars.
"Federal student aid is intended to expand educational opportunities, not line the pockets of fraudsters who steal from students pursuing their education and hardworking taxpayers," Treasury Secretary Scott Bessent wrote in a statement before its Monday public release.
The reports of suspicious activity came after a warning was issued in July, advising lenders to be on the alert for any possible wrongdoing in federal student loan refunds. And, predictably, the reports started flowing in.
Since the alert was issued, financial institutions have filed nearly 100 suspicious activity reports, according to the Treasury Department. FinCEN’s review identified more than 20,000 potentially suspicious transactions dating back to February 2026, totaling approximately $270 million.
And:
Many schemes involve fraudulent enrollments intended to divert aid from legitimate students. In "ghost student" schemes, criminals use stolen personal information, including names and Social Security numbers, to enroll fake students under victims’ identities.
Fraudsters may also combine stolen information with fabricated details to create synthetic identities capable of passing identity checks, using artificial intelligence agents and tools, according to the Treasury.
These would seem to incorporate identity theft along with the fraud. And, perhaps predictably, we see artificial intelligence (AI) being used in what are purported scams.
All of the various schemes to defraud the American taxpayers are pernicious, but there's an added element to the attempts to scam the student loan system, which is already bloated far out of any reasonable level. These programs are already suffering from welchers, and the young skulls full of mush waving signs demanding that the taxpayers repay the loans for which they freely signed contracts aren't the only ones not repaying. Now, we learn that there may well be millions in fraudulent payments as well?
This is, again, another great argument for getting the federal government completely out of the business of funding education. Not only has the explosion in federally guaranteed funding caused an unreal bloat in the costs of education, but it has also enabled the explosion of content-free, useless Underwater Ethnic Dog-Polishing Studies degrees - and now, we see, possibly millions in fraud as well.
It's past time to privatize the lot. Borrowing money for education should be like any other lending; based on the lender's perception of how likely the borrower will be to repay the loan. That would not only lean down the universities, but drain a lot of the fat and bloat out of the system would lead to fewer opportunities for scammers, as well.
In the meantime, it's still good to see, finally, an administration that's going after the scammers, vigorously and relentlessly. That's what we voted for.