I don't understand what the actual fraud is. Yes, fake AI bots are posing as real students to get financial aid, but this is ultimately paid to the school, not pocketed by the "student". What am I missing?
It's legit to have extra funds to pay for education related expenses.
"Pugh said she’d normally drop three to five from her roster who don’t start the course or make contact with her at the start of the semester. But during the current spring semester, Pugh said that number more than doubled when she had to cut 11 students"
I don't know. If I were a criminal I'd look for something that pays out more if I'm going to expose myself.
I had a high school friend use student loans to buy a car and rent a shithole apartment at 19. He’s probably still paying for that Toyota Camry now.
Surely this can't be completely anomalous? Certainly it's happened before where someone enrolls, receives financial aid, and then for any number of reason stops attending school? What happens then?
Or was that always a loss and now it's just easy to automate that scenario maliciously?
Here's where the system is defective. The loan's balance should go directly to the college's bank account, as a tuition payment.
Suddenly, there'd be no incentive to cheat the system, while actual students who need help paying for tuition would have their tuition paid.
Additionally, tuition aid isn’t given directly to school: It goes to the student, who pays the school.
It was always a huge relief to a student if they managed to get a scholarship in cash.
I had enough surplus to pay for a good APC UPS system as well as a 2018 Lenovo Thinkpad notebook. These were invaluable for my education, but they served me for years afterwards, personally as well as for employment.
Maybe this would still allow some fraud, but much, much less profitable.
Same here. Creating some expensive and complex system that fights “fraud” that consists of people taking on lifetime debt is dumb. Make the services share the pain for bad underwriting and the problem goes away instantly.