FIRST ON THE DAILY SIGNAL—The Trump administration is fixing the Free Application for Federal Student Aid program after uncovering around $1 billion in fraud, according to Education Secretary Linda McMahon.
“We have identified and saved about a billion dollars for FAFSA loans that would’ve been fraudulent,” McMahon told The Daily Signal in an exclusive interview.
The Biden administration only required identity verification for less than 1% of students applying for student loans, McMahon claimed.
“There were dead people who were applying for loans and receiving them, bots who were receiving, and we identified in Minnesota several thousands of these bots,” she said.
The Trump administration found about $90 million in federal student aid was fraudulently disbursed.
This includes more than $30 million given to deceased individuals and more than $40 million distributed to companies using bots disguised as fake students.
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McMahon said the agency has “totally revamped” FAFSA.
“We had it up and running even in advance of when Congress had said that we must do it,” she said.
“We actually have a section in it now that gives ROIs to parents as to how much programs cost and how much the student can expect to be paid in the job market. Good information for students and parents.”
While improving the FAFSA portal, the Education Department discovered the widespread fraud.
The agency launched an identity verification effort in June, and it found about 150,000 suspect identities in current FAFSA forms just within the first week.
The department announced in December it is hiring a new fraud detection team.
“We already have the team in place,” McMahon said. “We are working—it’s been amazing what we have discovered.”
“I’m very pleased with the results,” she continued, “so I think they’ve got a good team in place, and I think they’re doing a really good job.”
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