Ghost students are creating problems for California colleges

Original Article ↗ Hacker News Discussion ↗

How the fraud works (contested)

  • Many commenters were confused that “bots” could “steal aid” since aid often goes to schools first.
  • Others clarified:
    • Pell Grants and loans are typically disbursed to the school, which then sends any surplus to the student for books, equipment, and living expenses.
    • At community colleges, tuition is relatively low, so a large share of aid can end up as cash or cash-equivalents to the “student.”
  • Some argued the scam payoff at a CC seems small and high‑risk; others countered that even modest sums scaled across many fake identities add up.

Verification, IDs, and tradeoffs

  • Proposed fixes: mandatory in‑person ID verification after classes start; third‑party identity checks; or EBT-style cards restricted to tuition/education expenses.
  • Pushback:
    • In‑person requirements undermine online and remote access, especially for working adults or distant students.
    • More paperwork and documentation tends to punish legitimate low‑income/at‑risk students more than professional scammers.
  • California’s desire to serve undocumented and asylum‑seeking students complicates strict ID controls; institutions may also fear their data being used for immigration enforcement.

Scale, incentives, and who benefits

  • Official estimate: about 31% of applications flagged as fraudulent, but only ~0.21% of aid actually disbursed fraudulently; some see this as a tolerable, even optimal, non‑zero fraud rate.
  • Others note $10M in losses and significant hidden costs: IT systems, staff time, faculty policing, and real students locked out of full classes.
  • California’s funding formula (heavily based on headcount and Pell‑eligible students) may unintentionally reward inflated enrollment and weak verification.

Bots vs humans

  • Several commenters doubted that “AI bots” are truly the core threat, suggesting:
    • Plain human fraud with stolen or recycled identities.
    • “Ghost” behavior that looks similar to normal drop‑outs or disengaged students.
  • Faculty from multiple states reported obviously fake online students (template-like discussion posts, boilerplate intros), but still emphasized humans behind the behavior, not autonomous agents.

Broader system critiques

  • Thread drifted into US identity infrastructure: overreliance on SSNs, lack of robust national ID, and banks/government offloading “identity theft” costs onto individuals.
  • Some see the ghost-student issue as one more symptom of poorly designed aid systems, perverse incentives, and political resistance to both universal access and strong identification.