The title industry is not the only target for wire fraud. College is already expensive. For many students, financial aid is the primary means by which they can afford tuition, books, and living expenses. However, scammers are now using artificial intelligence (AI) to steal that aid before it ever reaches students. Financial aid scams aren't new. But AI has made them faster, harder to detect, and easier to pull off.
Criminals use AI tools to automatically fill out and submit fake Free Application for Federal Student Aid (FAFSA) forms. They create fake student profiles using stolen information-names, addresses, and Social Security numbers-and apply for aid under those identities. In some cases, they even enroll in low-cost online college programs to make the applications look more convincing.
Once the government or school sends out the aid money, scammers redirect it to bank accounts they control. The real students, whose identities were stolen, are left dealing with the damage.
Some fraudsters are even using AI-powered bots to scrape student data from social media and school websites, making their fake applications seem more legitimate. To demonstrate the magnitude of this problem, in one case, a community college financial aid officer flagged over 100 suspicious applications in a single day.
Takeaways for Households with Students
- Be careful with personal information. Don't share your Social Security number, student ID, or full date of birth on social media or public forums. Scammers gather this info to create fake student profiles.
- Check your FAFSA status. Log in to your account regularly to make sure there aren't any strange changes or updates you didn't authorize
- Watch for unexpected mail. If you get financial aid letters or emails from schools you didn't apply to, that's a red flag. It could mean someone is applying for aid in your name.
- Use strong, unique passwords. Ensure your FAFSA and school accounts are protected with strong passwords, and change them if you suspect any unusual activity.
- Report anything suspicious. If something seems off with your financial aid, tell your school's financial aid office immediately. You can also report suspected identity theft to the Federal Trade Commission.
Scammers are becoming increasingly sophisticated, but so can we.
#ALTACyber
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Genady Vishnevetsky
Chief Info Security Officer
Stewart Title Guaranty Company
Houston TX
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