Couple Indicted in Student Loan Fraud Case

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Students work hard to get into college. And, once accepted, they know they need to pay for it. Some work multiple jobs and/or rely on loans from family members to foot the bill. Many rely on the Department of Education’s student loan program – paid for by the American taxpayer – to help fund their college studies. Unfortunately, there are some with no intention of pursuing higher education who see the program as a target for fraud. That’s what’s alleged in today’s Fraud of the Day from TampaBay.com.

The article reports that a Florida couple has been indicted by a grand jury on charges of conspiracy to defraud the U.S. Department of Education, student loan fraud and mail fraud. (If true, they added a new twist to their wedding vows: to love, honor and fraud) Authorities allege that the couple formed a company and ”then recruited people who did not otherwise qualify for student loans and sent fraudulent applications to local colleges seeking student aid.” The article says the checks, which totaled $17,000, were sent directly to the company. (If multiple checks went to one address shouldn’t that raise a red flag?)

The allegations describe a brazen attempt to defraud taxpayers through the student loan program. It is important to note that these are simply that: allegations. The defendants are innocent until proven guilty. Even so, the scenario posed in the story raises a key question: how can student loan fraud be stopped? The allegations here center on using multiple identities all located at the same address to perpetrate fraud. It then follows, that the solution to stopping the fraud lies in leveraging identity-based filters to detect phony identities before sending the checks.

So, the question of the day is: does your government program need an identity-based solution to detect fraud?

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Couple Accused of Student Loan Scheme,” published by TampaBay.com on April 30, 2012.

TAMPA — A federal grand jury has indicted a Pinellas County couple of conspiracy to defraud the U.S. Department of Education in a student loan scheme, the U.S. Attorney’s Office said Monday.

Between August 2005 and September 2007, James Isaac Boyd, 40, and his wife, Shaneva Boyd, 30, formed a company called Graduate Assistance and Consolidations. The pair then recruited people who did not otherwise qualify for student loans and sent fraudulent applications to local colleges seeking student aid, the indictment said.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.