ROANOKE, Va. (WRIC) — A woman from Danville, Va., has pled guilty in federal court for defrauding the United States Department of Education and two other institutions out of more than $260,000 combined in fraudulent student loans.
According to a statement from the U.S. Attorney’s Office of the Western District of Virginia, Karen Warren, 43, conducted a scheme between 2013 and 2018 in which she stole money from the Department of Education, the American Public University System and Capella University by using the personal information of others to prepare and submit false FAFSA (Free Application for Federal Student Aid) forms.
Court documents revealed that Warren obtained the personal information of various individuals in order to send fake enrollment applications to the Department of Education, American Public University System and Capella.
After financial aid came through on the applications, Warren enrolled the individuals in online educational institutions, the statement from the U.S. Attorney’s Office read. Most of the people who Warren enrolled either did not participate or withdrew from the courses.
Warren then used the federal financial aid funds for her own benefit, a violation of the Department of Education’s requirement that federal financial aid funds are to be used only for education-related purposes.
According to the U.S. Attorney’s Office, the Department of Education, American Public University System and Capella University lost a combined total of at least $264,000 as a result of Warren’s actions.
On Friday, Nov. 4, Warren waived her right to be indicted and pleaded guilty to one count of student loan fraud and one count of unlawful transfer or possession of identification affecting interstate commerce, according to a statement from the U.S. Attorney’s Office. She faces a maximum penalty of 15 years in prison, and is set to be sentenced by a federal district court judge at a later date.
