Education Department clarifies FAFSA fraud checks before aid cycle
The Education Department has clarified what students should do when the real-time FAFSA fraud screen asks for identity confirmation or produces a fraud-related rejection.
Federal Student Aid published the guidance on July 17, 2026. It is operational guidance for colleges and financial-aid offices, not a new law or regulation. The instructions explain which applicants may face extra steps and how legitimate students can seek a school-based review.
How the online identity check works
Applicants selected for online identity confirmation must use a mobile device with a camera. A laptop or desktop cannot be used for this step, although a student may begin the FAFSA on another device and continue with a mobile phone or tablet.
The student does not need to own the device. Federal Student Aid says a parent’s phone or a counselor’s tablet may be used. The process requires one valid government-issued identification document, such as a driver’s license, passport, tribal identification card or permanent resident card, along with a brief live camera check.
The process is designed to be completed in one sitting. If the online check fails or is not completed, the FAFSA may be rejected, but that does not necessarily end the student’s path to federal aid.
Who may receive extra scrutiny
The system began evaluating students in real time on April 26, 2026. It reviews applicants during their initial FAFSA submission. A student who was not previously screened may also be evaluated when submitting a new online correction. Corrections submitted by financial-aid administrators through the FAFSA Partner Portal or batch correction process are not evaluated for fraud.
Federal Student Aid places applications into low-, moderate-, high- or highest-risk categories. Those categories indicate the system’s assessment of fraud risk; they are not findings that a student committed fraud.
Comment Code 353, used for moderate-risk cases, is generally informational. It does not require immediate action from the student, although a college may choose to conduct additional identity confirmation.
Higher-risk cases can produce Reject Code 74 with Comment Code 354 when an attempted identity check is unsuccessful, or Comment Code 355 when the process was not completed. The highest-risk category produces Reject Code 75 with Comment Code 357. That code’s notice tells the student that the Department detected fraudulent activity, but the code itself is a risk-screening result, not proof that the applicant committed fraud. Technical Comment Code 360 means the Department could not complete the risk evaluation; Federal Student Aid says students generally do not need to take action on that code.
What legitimate students should do after a rejection
An admitted or enrolled student who receives a fraud-related reject should contact the financial-aid office at the college or career school as soon as possible. The student should ask about V4 or V5 identity-confirmation procedures and the school’s fraud-override process.
Schools cannot adopt a blanket policy refusing to process federal aid for admitted or enrolled students who receive moderate-, high- or highest-risk indicators. If an enrolled or admitted student with a fraud-related reject or comment code contacts the school, the school must work with the student to confirm identity through an available in-person or video-call option. If the student successfully completes identity confirmation to the school’s satisfaction, the school must continue processing federal student aid.
After a successful review, a financial-aid administrator can use the FAA Fraud Override field in the FAFSA Partner Portal. The system can then generate a new transaction with a valid Institutional Student Information Record, assuming there are no other unresolved issues.
The Department says schools have no obligation to perform identity verification for people who are neither admitted nor enrolled. That makes it especially important for applicants to identify a college that has admitted them or where they are enrolled before seeking school-based resolution.
What the codes mean
- Comment Code 353: Moderate-risk information for the school. No immediate student action is generally required, although the school may conduct additional review.
- Reject Code 74 with Comment Code 354: The attempted identity-confirmation process was not successfully completed.
- Reject Code 74 with Comment Code 355: The required identity-confirmation process was not completed.
- Reject Code 75 with Comment Code 357: The application was placed in the highest-risk category and rejected. A legitimate student should promptly contact the financial-aid office.
- Comment Code 360: A technical problem prevented the Department from completing its risk evaluation. No immediate student action is generally required.
What happened to earlier 2026-27 FAFSA forms
Applications submitted before the real-time system launched went through a one-time screening. Federal Student Aid reported that approximately 300,000 2026-27 applications were selected for Verification Tracking Group V5 during that review.
That figure is a count of applications selected for additional review, not a count of confirmed fraud cases. The Department says those pre-launch applications are treated as already evaluated to avoid duplicate screening and contain both the V5 verification flag and Comment Code 353.
Practical steps for students
If FAFSA requests identity confirmation, keep a mobile phone or tablet with a camera and an acceptable government-issued ID available. A student may use a parent’s phone or a counselor’s tablet for the online step.
If the online process fails, contact the financial-aid office at an admitted or enrolled school, ask about the school’s V4 or V5 identity-confirmation procedures, and ask whether the FAA Fraud Override process applies. Keep copies of documents and communications, and ask what deadline applies to the aid package.
Students should also watch for a new online FAFSA correction to trigger screening if they were not evaluated during their initial submission or a prior correction.
The Education Department says the screening is intended to block fraudulent applications while allowing legitimate students to proceed. The Department has estimated that its broader effort could save more than $1 billion during the FAFSA cycle, but that is a projection, not realized savings.
Sources
- Federal Student Aid: FAFSA fraud-detection and identity-confirmation FAQ
- U.S. Department of Education: Nationwide Federal Student Aid Fraud Prevention Effort
- Inside Higher Ed: Understanding the FAFSA fraud crackdown
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