Federal student aid fraud

What a public sentencing described

On June 25, 2025, the U.S. Attorney’s Office for the Eastern District of North Carolina announced that Cynthia Denise Melvin, 60, was sentenced to five years in prison and three years of supervised release for conspiracy to commit wire fraud. She pleaded guilty on February 26, 2025. The court ordered restitution of $3,641,473 to the U.S. Department of Education. ¹ Source 1

The release says that between about 2016 and 2023 she organized about 80 straw students and others to apply for federal student aid at Wake Technical Community College, Cape Fear Community College, and Fayetteville Technical Community College. Education OIG estimated more than $4.7 million in aid awards, of which more than $3.5 million was disbursed. The release calls the scheme, based on fraud losses, the largest of its kind prosecuted in North Carolina. This page reports both the estimate and the restitution figure because the release reports both. ¹ Source 1

The release says she collected personal information, submitted fraudulent applications for admission, impersonated the straw students in classwork and school communications, and submitted FAFSA forms for them. ¹ Source 1

Which published programs may apply

The Fraud Division FAQ gives student aid fraud as the example of fraud on programs administered by the Department of Education. That subject can qualify for the discretionary $10,000 to $30,000 early reward if the other published requirements are met, including unsealed criminal charges. ² Source 2

Federal student aid is federal money. Knowingly false claims for it can also be analyzed under the False Claims Act. The North Carolina release is a criminal wire-fraud sentencing. It does not report a relator share. ¹ Source 1 ³ Source 3

Where to report

Report at America.gov/fraud. The Education Department’s Office of Inspector General is the office the North Carolina release says investigated that case. The Civil Division describes inspector general reports as one federal path. This site’s report button stays on the Justice Department portal and does not collect the tip. ¹ Source 1 ⁴ Source 4 ⁵ Source 5