US Embassy thanks DCI, ODPP, KRA, says fraud probe not over after Sh97 M crypto seizure

The United States Embassy in Nairobi has praised Kenyan law enforcement agencies and prosecutors for their role in an international investigation into an alleged student financial aid fraud network linked to Kenyan nationals.

In a statement on Friday, October 30, the Embassy said cooperation between the two countries had helped investigators seize more than $750,000 (approximately Sh97 million) in cryptocurrency from an account belonging to a Kenyan national connected to the alleged scheme.

The Embassy named the Directorate of Criminal Investigations (DCI), Asset Recovery Agency (ARA), Office of the Director of Public Prosecutions (ODPP), Kenya Revenue Authority (KRA) and Financial Reporting Centre (FRC) among the Kenyan institutions that assisted the investigation.

"Tackling an international fraud ring of this scale is the result of longstanding cooperation between Kenya and the United States," the Embassy stated.

It added that the investigation was not over, signalling further enforcement action as authorities continue tracking individuals and assets linked to the alleged network.

"This team of investigators is not finished with their work to fight fraud and protect citizens," the statement added.

The Embassy also expressed gratitude for the assistance and professionalism of Kenyan law enforcement officers and prosecutors, noting that intelligence provided by local agencies had contributed to the cryptocurrency seizure.

The Embassy's statement followed a post by the White House highlighting the alleged involvement of Kenyan nationals in the fraud investigation, dubbed Operation Ghostbusters.

The White House accused individuals linked to the network of using stolen American identities to obtain federal student aid and divert the money for personal gain and to overseas co-conspirators.

"Kenyan nationals used stolen American identities to commit fraud by funneling federal student aid for their own personal gain and co-conspirators overseas," the White House stated.

It credited the US Department of Justice and the White House Task Force to Eliminate Fraud with leading the crackdown.

The developments came hours after the US Justice Department announced charges against five defendants in three separate cases in Virginia, Nebraska and New Jersey, alongside the seizure of more than $750,000 in cryptocurrency connected to the alleged network.

According to the Justice Department, the scheme involved criminals stealing personal information belonging to American citizens and using it to create fraudulent applications for Federal Student Aid through the Free Application for Federal Student Aid (FAFSA) system.

The identities were allegedly used to enrol fictitious students, commonly referred to as "ghost students", in American colleges and universities.

After the government disbursed student loans and grants, tuition and other charges were deducted, while the remaining funds were allegedly diverted into bank accounts controlled by fraudsters and their associates.

The Justice Department said US-based money mules, including Kenyan nationals, helped receive the refunds and transfer proceeds to overseas associates.

Some of the fictitious students allegedly never attended classes, with investigators saying fraudsters used artificial intelligence to complete coursework and maintain the appearance of genuine enrolment.

The wider investigation is believed to cover fraud dating back to at least 2021, with estimated losses exceeding $200 million.

Among the cases announced by the Justice Department is that of Francis Mogambi, a Kenyan citizen indicted in Nebraska on five counts of theft of government money and five counts of aggravated identity theft.

Prosecutors allege that between November 2025 and May 2026, Mogambi worked with associates in Kenya to steal American identities, fraudulently enrol fictitious students and redirect federal student aid payments.

He is accused of retaining 30 per cent of the proceeds and sending the remainder to his alleged co-conspirators in Kenya.

In a separate case in Virginia, an unnamed Kenyan national was indicted over an alleged scheme involving more than 700 fraudulent student aid refund deposits worth approximately $1.44 million. The indictment remains under seal.

Three other defendants in New Jersey are accused of acting as money mules, receiving more than $1 million in funds obtained through fraudulent applications before transferring money to associates in Kenya linked to a purported safari company.

The US government said it intends to pursue charges against two alleged Kenya-based co-conspirators as the New Jersey investigation continues.

All five defendants have been charged in separate proceedings, and the allegations have yet to be proven in court.

The Justice Department said representatives from its Fraud Division and partner agencies visited Kenya in September to promote extradition, prosecution and the recovery of funds allegedly stolen from American taxpayers.

It credited intelligence and assistance from Kenyan law enforcement partners for helping investigators seize the cryptocurrency, describing the recovery as the first international seizure of its kind in the history of the Fraud Division.

Investigators have also identified 830,840 potentially fraudulent Federal Student Aid identification numbers associated with nearly $130 million and recommended that the US Department of Education disable them.

The investigation has expanded to more than 40 open cases across 26 FBI field offices and over 20 US Attorneys' Offices.

According to the Justice Department, Operation Ghostbusters will continue working with Kenyan counterparts to recover assets and pursue individuals suspected of participating in the alleged fraud.

The department has emphasised that an indictment or criminal complaint contains allegations, and all defendants are presumed innocent unless proven guilty in court.