A Kenyan national, Francis Mugambi, has been indicted by a grand jury in Nebraska on charges of stealing government funds and aggravated identity theft. The indictment alleges that Mugambi ran a scheme that defrauded the US student financial aid programme between November 2025 and May 2026. He is accused of enrolling ghost students in several colleges and universities, using stolen personal information from US citizens who had not attended college.
According to the indictment, Mugambi identified US citizens who had not attended college, stole their personal information, and used their identities to enroll them in higher education institutions. He then applied for federal student financial aid through the Free Application for Federal Student Aid (FAFSA), a programme administered by the US Department of Education. Once the applications were approved, the government disbursed funds to cover tuition and other fees.
The US government alleges that any remaining money after tuition and fees were deducted was deposited into bank accounts controlled by Mugambi and his alleged accomplices. Prosecutors claim that Mugambi retained 30 per cent of the proceeds and wired the remainder to associates in Kenya. The US government estimates that the scheme involving Mugambi resulted in losses of about Sh2.5 million ($20,000).
The investigation that led to Mugambi's indictment was part of a wider crackdown dubbed ‘Operation Ghostbusters,’ through which US authorities estimate that the student aid fraud schemes have cost the government approximately Sh376 million ($2.9 million). Mugambi's case is linked to a wider investigation that has also seen two other suspects arrested over allegations that they obtained more than Sh130 million ($1 million) and transferred the proceeds to Kenya through a purported safari company.
The US Department of Justice further alleges that the scheme ran from March 2021 to January 2026, potentially costing the government about Sh195 million ($1.5 million). Kenyan suspects linked to the wider operation could also face prosecution as investigators continue to pursue the case. Assistant US Attorney General Colin McDonald described the schemes as organised fraud on a large scale.
The investigation was conducted by the Justice Department's National Fraud Enforcement Division, alongside the Federal Bureau of Investigation, the Department of Education, and other US law enforcement agencies, working with Kenyan authorities. The Kenyan agencies involved in unearthing the details include the Directorate of Criminal Investigations, the Assets Recovery Agency, the Kenya Revenue Authority, and the Financial Reporting Centre.
In a related case, two Kenyans are among five people charged in three related cases involving alleged student aid fraud in Virginia, Nebraska, and New Jersey. The US Embassy in Kenya said investigations were ongoing, warning that authorities would continue pursuing those involved in defrauding American taxpayers. The embassy expressed gratitude for the assistance and professionalism of Kenyan law enforcement and prosecutors.
Key points
- A Kenyan man, Francis Mugambi, has been indicted in the US for stealing government funds and aggravated identity theft in a scheme that defrauded the US student financial aid programme.
- The US government estimates that the student aid fraud schemes have cost the government approximately Sh376 million ($2.9 million).
- Kenyan suspects linked to the wider operation could also face prosecution as investigators continue to pursue the case.
