US prosecutors announce charges against five people and seize cryptocurrency as Kenyan agencies help investigate alleged theft of federal education funds.
American authorities have warned Kenyans suspected of student aid fraud that investigators will pursue them in Nairobi. The warning accompanies charges against five people and the seizure of more than $750,000, approximately Sh97.5 million, in cryptocurrency.
Assistant Attorney General Colin M. McDonald said national borders would not protect suspects accused of stealing federal education funding. He specifically named Nairobi among the places where authorities would pursue those involved.
The US Department of Justice announced the charges and seizure on October 29, 2026. McDonald said the cryptocurrency allegedly passed through a financial network associated with Kenyan nationals.
Kenyan agencies join student aid fraud investigation
The investigation, called Operation Ghostbusters, targets alleged misuse of Americans’ identities to secure federal education assistance. Investigators say suspects used stolen personal information to create student profiles and fraudulent college enrolments.
After securing approval for loans and grants, the suspects allegedly redirected payments into accounts they controlled. Some proceeds then moved through financial channels outside the United States, including networks associated with Kenya.
Meanwhile, Kenya’s Directorate of Criminal Investigations, Asset Recovery Agency and Office of the Director of Public Prosecutions are assisting the inquiry. The Justice Department acknowledged their help in identifying suspects, tracing funds and pursuing assets.
The latest cryptocurrency seizure involved an account belonging to a Kenyan national. The department described it as the National Fraud Enforcement Division’s first international seizure of its kind.
Kenyan national faces charges in Nebraska
Among the defendants is Kenyan national Francis Mogambi, whom prosecutors indicted in Nebraska on October 19. He faces five counts each of theft of government money and aggravated identity theft.
Prosecutors allege Mogambi worked with associates in Kenya to fraudulently enrol people in educational institutions and divert their aid. They also accuse him of retaining 30 per cent of the payments before sending the balance to alleged accomplices.
The other prosecutions cover alleged fraudulent applications and diverted student funding in Virginia and New Jersey. Across the wider investigation, authorities have identified more than 830,000 potentially fraudulent Federal Student Aid accounts.
Those accounts are associated with nearly $130 million, approximately Sh16.8 billion. Meanwhile, estimated losses from the wider scheme exceed $200 million, or about Sh25.9 billion, as investigations continue.
US authorities say they will continue working with Kenyan agencies to identify participants and recover suspected proceeds. All defendants remain presumed innocent until a court proves their guilt.
