WASHINGTON, D.C. — The U.S. House of Representatives passed the No Aid for Ghost Students Act in June 2026. The legislation requires the Department of Education to screen federal aid applications for potential fraud and codifies the department's Real-Time Fraud Detection initiative.

The Department of Education launched its Real-Time Fraud Detection initiative in spring 2026. The department rolled out its Real-Time Detection tool for the 2026–27 Free Application for Federal Student Aid (FAFSA) in April 2026. This tool analyzes applicant behaviors during the FAFSA filing process.

As of June 2026, the Department of Education stated that the Real-Time Detection system prevented more than $100 million from reaching fraudsters. The federal government also stated it curbed $1 billion in attempted financial aid fraud in 2025.

Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators, said fraudsters have been stealing financial aid funds for at least 10 years, using stolen identities to apply for federal aid and loans before disappearing with the money. She noted some perpetrators avoid verification requirements by pretending to be under age 18 or homeless, while others take a full semester of courses to steal aid in the following semester. Education Department officials stated that the prevalence of FAFSA scams increased during the COVID-19 pandemic.

When an applicant exhibits signs of fraud in the Real-Time Detection system, they are prompted to verify their identity on camera. If this identity verification is unsuccessful or declined, the FAFSA application is rejected. The No Aid for Ghost Students Act gives the Department of Education permission to implement identity screenings based on reasonable suspicion of fraud.

McCarthy provided details on the new process. "The school doesn't have to reach out [to potential scammers] and say, 'Hey, you've been selected, I need you to send us a copy of ID,'" McCarthy said. She also explained, "The only requirement is that if a student who has one of these rejected FAFSAs comes forward [and] they're an actual person, they appear in the aid office or reach out … the institution has to offer them the opportunity to submit identity documents."

Republican Rep. Burgess Owens of Utah sponsored the No Aid for Ghost Students Act. Thirty-six Democrats voted with Republicans to advance the legislation. However, Rep. Bobby Scott, the top Democrat on the House Education and Workforce Committee, expressed reservations. "Codifying this new system, without assessing its effectiveness, just doesn't make any sense," Scott said.