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Scathing Report Finds Biden Admin Ignored Fraud Risks When Approving Student Loan Applications

WASHINGTON – Education and the Workforce Committee Chairwoman Virginia Foxx (R-NC) reacted to a disturbing and scathing report issued today by the government watchdog—Government Accountability Office (GAO)—that found Biden’s Education Department approved millions of applicants to receive student loan “forgiveness” without reviewing and evaluating the potential for fraud: 
“Biden’s Education Department is an expert in dropping the ball when it comes to upholding good governance—the findings of this GAO report confirm this. Rather than intervening to mitigate instances of fraud from students who applied for loan ‘forgiveness,’ the Department leaned back in its chair, kicked its feet up, and took a nap. The Department’s lack of appetite for oversight and accountability poses a serious financial risk to the students it purports to serve and the taxpayers of whom it takes advantage.”

  • GAO was concerned that the scale of the program—with the possibility of $430 billion going to over 31 million borrowers—made it inherently at risk for fraud and necessitated effective fraud risk management, which the Education Department planned for, but did not do. 
  • The Department sought to expedite approvals for millions of borrowers by approving them automatically, and in doing so, it did not implement adequate checks for potential fraud.
  • The bottom line is the Department relied solely on self-reported data for more than two million of these borrowers.  
  • By not addressing the risks of self-reported data, the Education Department left the door open to the possibility of ineligible borrowers receiving money based on fraudulent data. 


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