South Michigan News: House passes bill to address fraud in federal student aid programs

Education and Workforce Committee Chairman Tim Walberg praised House passage of H.R. 7892, No Aid for Ghost Students Act, which aims to address fraud by so-called "ghost students" who use fake or stolen identities to collect federal student aid, according to a June 10 statement.

Walberg said, "Fraudsters have stolen billions of taxpayer dollars from our federal student aid programs, diverting resources away from students pursuing an education. No Aid for Ghost Students Act is a common-sense solution to strengthen oversight, improve identity verification, and stop fraud before it happens—ensuring we can maintain the integrity of our federal student aid system. Every federal student aid dollar should go to a student pursuing an education, not to criminals exploiting the system."

The legislation was introduced by Representative Burgess Owens and incorporates provisions from the Student Aid Fraud Oversight and Accountability Act authored by Representative Glenn “GT” Thompson. The bill mandates front-end identity fraud screening for applications for federal student aid and flags those that present high risk of fraud. It also requires identity verification for flagged applications before any funds are disbursed.

In addition, the act provides schools with clear guidance on how to verify identities and seeks to protect institutions most at risk from fraudulent activity. The bill further strengthens oversight mechanisms related to student aid fraud in order to help ensure taxpayer dollars are directed only toward eligible students.

The House Education and Workforce Committee manages federal programs concerning education, labor, health and workforce development; influences policy on issues such as student loans and worker protections; and serves in the legislative sector with jurisdiction over education and labor matters, according to the official website.