£6.5m paid out on fraudulent student loans

 

Criminal gangs have targeted the student loan company, costing the taxpayer millions, according to new reports.

The Student Loan Company (SLC) issued 875 fraudulent payments before suspicions were raised. These payments were among nearly 2,450 applications that were considered suspect, according to figures obtained by Radio 4’s You&Yours programme.

A spokesperson for SLC said: “We continually strive to look at ways to make the application process more secure and less susceptible to fraudulent activity ensuring that only those students who are eligible to receive funds are able to access them.”

The money lost has increased from just over £1m last year to £6.5m in the current financial year.

Three times more student loans were cancelled last year owing to suspected fraud than the year before, which is seven times more than in 2009.

Helen Laing, a spokesperson for SLC, said: “We suspect that the rise in organised criminal fraudulent activity is partly down to the fact that the activity has migrated from other businesses and that we have been identified as a new target.”

Laing continued that SLC has a ‘robust system of checks and safeguards in place’. She continued saying: “The higher fraud detection rates have been achieved as a result of new counter-fraud tools and advanced analytical capability. These tools represent an excellent return on investment and will lead to more investment in improved fraud detection and prevention systems.”

In May of this year, thieves who stole £380,000 from the SLC were sentenced. They provided fake exam certificates to applicants who then applied to university and student loans.

The gang charged £1,000 for the exam certificates and then took a cut from the student loan payments. The group received a total of seven years in prison.

In 2011, another criminal gang directly targeted students by sending phishing emails which appeared to be from the SLC asking students to update their personal details.

Instead of the official website students were re-directed to a similar looking site which was controlled by the group.

Hundreds of students across the UK were defrauded in this way, in a fraud that cost an estimated £1.6 million.

Laing said: “In cases where students have had their loan funds stolen, liability is considered on an individual case basis. We do reimburse students where investigation establishes they have genuinely been the victim of a phishing scam.”

SLC commented that students were often targeted at the three main institution dates in September, January and April and that students need to work with the SLC to ensure their identity and financial details are protected and not compromised.

Suggested Topics
News
news
Arts and Entertainment
British author Helen Macdonald, pictured with Costa book of the year, 'H is for Hawk'
booksPanel hail Helen Macdonald's 'brilliantly written, muscular prose' in memoir of a grief-stricken daughter who became obsessed with training a goshawk
Sport
footballLive blog: Follow the action from the Capital One Cup semi-final
Life and Style
food + drink
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs Student

Ashdown Group: Trainee / Graduate Helpdesk Analyst

£20000 per annum: Ashdown Group: A highly reputable business is looking to rec...

Ashdown Group: Graduate Data Analyst - Essex - £25,000

£23500 - £25000 per annum + Training: Ashdown Group: Graduate Data analyst/Sys...

Recruitment Genius: Graduate Account Manager

£16000 - £30000 per annum: Recruitment Genius: A Graduate Account Manager is r...

Guru Careers: Graduate Account Manager / Sales Executive

£18k + Uncapped Commission (£60k Y1 OTE): Guru Careers: A Graduate Account Man...

Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Day In a Page

Greece elections: In times like these, the EU has far more dangerous adversaries than Syriza

Greece elections

In times like these, the EU has far more dangerous adversaries than Syriza, says Patrick Cockburn
Holocaust Memorial Day: Nazi victims remembered as spectre of prejudice reappears

Holocaust Memorial Day

Nazi victims remembered as spectre of prejudice reappears over Europe
Homeless Veterans appeal: Homeless in Wales can find inspiration from Daniel’s story

Homeless Veterans appeal

Homeless in Wales can find inspiration from Daniel’s story
Front National family feud? Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks

Front National family feud?

Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks
Woman who was sent to three Nazi death camps describes how she escaped the gas chamber

Auschwitz liberation 70th anniversary

Woman sent to three Nazi death camps describes surviving gas chamber
DSK, Dodo the Pimp, and the Carlton Hotel

The inside track on France's trial of the year

Dominique Strauss-Kahn, Dodo the Pimp, and the Carlton Hotel:
As provocative now as they ever were

Sarah Kane season

Why her plays are as provocative now as when they were written
Murder of Japanese hostage has grim echoes of a killing in Iraq 11 years ago

Murder of Japanese hostage has grim echoes of another killing

Japanese mood was against what was seen as irresponsible trips to a vicious war zone
Syria crisis: Celebrities call on David Cameron to take more refugees as one young mother tells of torture by Assad regime

Celebrities call on David Cameron to take more Syrian refugees

One young mother tells of torture by Assad regime
The enemy within: People who hear voices in their heads are being encouraged to talk back – with promising results

The enemy within

People who hear voices in their heads are being encouraged to talk back
'In Auschwitz you got used to anything'

'In Auschwitz you got used to anything'

Survivors of the Nazi concentration camp remember its horror, 70 years on
Autumn/winter menswear 2015: The uniforms that make up modern life come to the fore

Autumn/winter menswear 2015

The uniforms that make up modern life come to the fore
'I'm gay, and plan to fight military homophobia'

'I'm gay, and plan to fight military homophobia'

Army general planning to come out
Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century