STUDENT visas are being exploited to smuggle people into Australia via a network of unscrupulous migration and education agents, landlords and employers, the head of the nation's biggest overseas student recruitment agency said yesterday.

Tony Pollock, the chief executive of IDP Education Australia, the main recruiter for Australia's $16 billion industry in foreign students, described a "chain of exploitation".

Some overseas students had become victims of deception from "a highly integrated chain" of misrepresentative and exploitative education and migration advice, access to dodgy colleges, part-time work and accommodation, he said. "This could be construed as people-smuggling."

At a minimum, it involved hundreds of students coming to Australia every year, he said.

Mr Pollock said the practice caused "deep resentment" among students who were being mercilessly exploited by countrymen, and had to be rooted out.

An investigation by The Australian has revealed that the racket starts overseas with the bogus student being offered a "package" of the finance necessary to satisfy Australian student support requirements, plus fake documentation, access to a dodgy private college, accommodation and even part-time work.

In order to get a visa, students are required to have at least $12,000 in a bank account, but under the scam the education agents lend the bogus students the money they need to circumvent financial requirements.

The loan is given at a high rate of interest, and in some cases the bogus student must make an immediate upfront payment of up to one-third of the total back to the agent.

The bogus student is then provided with false English language documentation to study in Australia at a certain educational level, and enrolled in a college owned by the agent or a relative in Australia.

Once in Australia, the student does not even show up for class but is marked as fully attendant to satisfy strict visa requirements, provided fees are paid.

To complete the package, the bogus student is provided with accommodation and often a part-time job in a restaurant or taxi owned by one of the principals in the chain.

An Indian migration agent, who would not be named, said it was common for agents linked to Australian colleges and businesses to recruit students and provide hefty high-interest loans: "They are all part of one syndicate. They are linked by someone's brother or someone's cousin in a different name. The students are under threat. The students are scared."

The Australian revealed in September that a Korean education agent was found to be running a house in Sunnybank, Brisbane, that was housing up to 37 foreign students.

A law firm that deals with migrant visas has accused education agents of taking kickbacks for finding jobs and accommodation for the students they recruit.

"Unscrupulous education agents are the first point of contact for an overseas student and a level of trust is built, which some take advantage of," Visa Lawyers Australia principal Aristotle Paipetis said.

"International students may do things and tell agents things the agent may use as a means of exploiting them."

Education Minister Julia Gillard said yesterday the government deplored unscrupulous operators and investigated all allegations onshore.

"Ultimately we have no sovereign power over unregistered agents operating in other countries," she said.

Ms Gillard urged people to report such operators to police.