The U.S. Treasury Department says it has flagged roughly $270 million in suspicious financial activity that may be connected to fraud schemes targeting federal student aid programs. The department disclosed the figure to Fox Business on Monday.
Treasury’s Financial Crimes Enforcement Network, known as FinCEN, has referred its findings to federal investigators for further review, according to the report.
The disclosure follows a July alert FinCEN issued to financial institutions warning them about fraud rings exploiting student aid programs. In that alert, the agency said criminals have been using stolen and fabricated identities to create “ghost students” who enroll in colleges and universities solely to collect federal aid money. FinCEN said these schemes not only drain money from taxpayer-funded programs but can also make it harder for real students to register for classes because fake enrollees are taking up space.
Treasury Secretary Scott Bessent addressed the fraud findings in a statement, saying, “Every dollar stolen from Federal student aid is a dollar taken from taxpayers and deserving students.”
Ahead of Monday’s report, Bessent said the administration intends to pursue those responsible. “The Trump administration will not tolerate criminals who exploit government programs for personal gain,” he said. “Treasury is working with financial institutions and law enforcement to identify these fraud schemes, recover stolen funds, and hold those responsible accountable.”
In a social media post over the weekend, Bessent pointed to other anti-fraud efforts at Treasury, saying the department “follows the money.” He noted that over the past year Treasury recovered $175 million in payments that would have gone to deceased individuals and expanded a screening tool called Do Not Pay to cover 99 percent of federal programs.
Bessent also said fraud networks operating from overseas, including those targeting elderly Americans, are now facing U.S. sanctions. He added that Treasury is encouraging people with direct knowledge of fraud schemes to come forward, offering confidential whistleblower channels and cash rewards. “If these fraudsters want to turn on each other, we welcome the assistance,” he said.
The student aid fraud findings are part of a broader push by the Trump administration to reduce waste, fraud, and abuse across federal spending programs.
