AI chatbots are stealing student identities to scam financial aid

A disturbing new scam is taking root in higher education. According to a recent report, sophisticated AI chatbots are now impersonating students to steal financial aid and occupy seats in online courses. This isn’t just a one-off incident. It’s already costing schools millions and could be shutting out legitimate students across the US and beyond.

These chatbots are powered by stolen personal data, often from recent breaches. Using real names, addresses, Social Security numbers, and academic records, they create fake student profiles that are convincing enough to slip past admissions filters. Once accepted, they apply for grants and loans, sometimes even logging into online classes just long enough to get the money. Then they disappear.

Some online classrooms have reportedly been filled with nothing but AI imposters. That leaves real students struggling for access while schools unknowingly fund bots pretending to be people.

The AP report notes that community colleges and large public institutions are especially vulnerable. With high application volumes and limited resources, it’s hard to manually verify every student. The losses are already mounting, and there’s little chance of recovering the funds.

This new kind of fraud isn’t going away anytime soon. But staying alert and locking down your data is the first step in keeping AI scammers from turning you into a phantom student.

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