A Fayetteville woman, Cynthia Denise Melvin, age 60, has been sentenced to five years in federal prison for orchestrating a scheme that stole over $5 million in federal student aid from community colleges across North Carolina. Melvin pleaded guilty to wire fraud on February 26, 2025. In addition to her prison sentence, she was ordered by the court to pay $3,641,473 in restitution to the U.S. Department of Education.
According to court documents and information presented during the proceedings, Melvin led a conspiracy between 2016 and 2023 involving approximately 80 individuals who acted as “straw students.” The group submitted fraudulent applications for federal student aid at several community colleges in North Carolina, including Wake Tech, Cape Fear Community College, and Fayetteville Tech. Investigators from the U.S. Department of Education’s Office of Inspector General (OIG) estimated that more than $5 million in financial aid was awarded through this scheme, with over $3.5 million actually disbursed. Authorities described it as the largest case of its kind prosecuted in North Carolina.
The Office of Federal Student Aid (FSA), which is part of the U.S. Department of Education, manages financial aid programs intended to help qualified students pursue higher education and processes applications through the Free Application for Federal Student Aid (FAFSA). Typically, after tuition and fees are paid directly to a school from a financial award, any remaining funds are given to students for other education-related expenses.
Investigators determined that Melvin collected personal information from straw students and used it to submit fraudulent applications at targeted schools. She then impersonated these individuals by faking class attendance and coursework completion while concealing her role as preparer on FAFSA forms submitted online.
During a search of Melvin’s home under a federal warrant, OIG agents found evidence detailing how the operation worked. Items recovered included personal data and coursework for straw students along with FSA account credentials and banking information.
Andrew Balceniuk, Acting Special Agent in Charge at the U.S. Department of Education Office of Inspector General’s Eastern Regional Office said: “I’m proud of the work of OIG special agents and our law enforcement colleagues for shutting down yet another student aid fraud ring and holding Ms. Melvin accountable for her criminal actions,” adding: “The Office of Inspector General is committed to stopping student aid fraud rings, and we will continue to aggressively pursue anyone who participates in them.”
The announcement was made by the United States Attorney for the Eastern District of North Carolina following sentencing by Chief Judge Richard E. Myers II. The case was investigated by the U.S. Department of Education’s Office of Inspector General and prosecuted by Assistant U.S. Attorney Adam F. Hulbig.
