How to Strengthen Identity Security in Higher Education

As higher education continues its shift toward digital enrollment and online portals, institutions face a growing challenge: balancing accessibility with security. While digital channels provide essential flexibility for students, they have also introduced vulnerabilities that lead to “ghost student” enrollment and financial aid fraud. Ghost students are fraudsters who use stolen or fake identities to enroll in classes and apply for financial aid, and disappear once they receive the funds.

According to the Department of Education’s Office of Inspector General, more than $350 million in financial fraud committed by ghost student schemes have been uncovered over the past five years. In 2024, the California Community Colleges system estimated nearly a third of college applications were fraudulent. 

Institutions have two objectives: to protect institutional funding and student privacy, and to preserve the seamless experience for the students. Many universities are looking to move away from frictionful, static document validation that requires scanning and perfect lighting, and toward passwordless identity verification based on real-time, deterministic data.

Key Challenges to the Digital Campus

1. The Threat of Ghost Students: In this scenario, fraudsters use stolen or synthetic identities to enroll for courses and apply for financial aid. Traditional enrollment systems often rely on social security numbers and birthdates, which is frequently compromised in data breaches. This makes fraudulent applications appear legitimate during the initial automated screening.
2. Financial Aid Hijacking (Account Takeover): Even legitimate student accounts are at risk. Using mobile hijacking methods to intercept account password reset security codes, unauthorized users gain access to existing student portals. Once inside, they can change the direct deposit information, diverting financial aid and loan disbursements into external accounts.
3. Phishing and Social Engineering: Despite being comfortable with technology, many students remain vulnerable to targeted phishing. Fraudsters trick students into providing login credentials via SMS or email links to gain access to their accounts.

Modernizing Identity Verification Frameworks

To mitigate these risks, institutions should adopt a multi-layered approach by utilizing real-time risk signals that cover different aspects of an identity. This approach lets universities verify their students with higher confidence. Here is how Zumigo solution helps:

1. Eliminate Synthetic Identity Fraud: Unlike basic credit-check systems that rely on cached data, Zumigo leverages direct Mobile Network Operator (MNO) and other real-time data to verify that the financial aid applicant’s identity is legitimate. For example, the applicant’s name, address and email can be verified against the records associated with the mobile phone number, and the owner of the mobile phone or number can be authenticated via SIM-based authentication or silent network authentication. Other aspects such as bank account information, government-issued ID, and social security number can also be verified at the same time to ensure the applicant isn’t piecing together different stolen credentials to create an identity.
2. Prevent Account Takeover Fraud: ATOs happen when fraudsters use stolen credentials to gain unauthorized access to student accounts to harvest personally identifiable information (PII); steal credit card information; and financial aid disbursement. Zumigo authenticates a student’s mobile identity using authoritative data such as the mobile phone number, account activities, and other PII and behavioral information on file. Using real-time, definitive sources and through a layered approach, Zumigo can instantly detect fraudulent use of a consumer’s identity for unauthorized account access and purchases.
3. Leverage Passwordless Security: Students are sophisticated digital natives who prefer a seamless experience. Zumigo’s FIDO-based passkeys and the above authentication technologies eliminate the need for cumbersome passwords and vulnerable one-time passcodes sent via SMS. Students can securely log in to their portals using the phone number and passkeys, providing the highest level of security (phishing-resistant) without the friction that leads to help-desk fatigue and portal abandonment.
4. Fast Verification Workflow Deployment: University IT and compliance departments are often stretched thin. Zumigo offers a low-code identity verification workflow that allows university administrators to quickly build and deploy risk-tiered workflows that meet their requirements. For example, a university can set a “low-friction” path for library access but trigger a “high-assurance” verification using a multi-layered approach for a comprehensive risk assessment without writing a single line of custom code.

Conclusion: Maintaining Institutional Integrity

The epidemic of ghost students can drain millions from limited institutional budgets and disrupt student experience, which means the security of the virtual campus is a strategic imperative. By verifying student identities using real-time data that doesn’t impede a seamless experience, higher education institutions can ensure that financial aid reaches the students who truly need it, while protecting their reputation and operational integrity.

Ready to secure your institution? Contact us for a demo today.

Yu-Ting Huang is Sr. Director of Marketing at Zumigo. Comment or questions? Find her at LinkedIn @yutinghuang.