Lori Loughlin 'freaking out' over new college cheating scandal charges, thought she'd 'skate by'

Lori Loughlin exits the John Joseph Moakley U.S. Courthouse. Photo / Getty Images

The truth has finally set in for Lori Loughlin that she could be facing real jailtime after spending much of time up until now "in complete denial".

A source told E! News: "She has been in complete denial and thought maybe she could skate by.

"She refused to accept any jail time and thought the DA was bluffing. She was adamant she wouldn't do any jail time."

"Lori is finally realising just how serious this is. She is seeing the light that she will do jail time and is freaking out."

Loughlin, 54, and fashion designer husband Mossimo Giannulli were arrested last month for allegedly bribing their daughters' ways into the University of Southern California (USC) for US$500,000 each.

The pair allegedly paid scam mastermind William "Rick" Singer to get daughters Isabella and YouTube star Olivia Jade recruited to the USC crew team despite neither of them being a rower.

Isabella and Olivia's statuses at USC are on hold as the school's investigations continue into individual cases.

On Tuesday, Loughlin and Giannulli were indicted on charges of fraud and money laundering. If convicted, the couple faces up to 40 years in prison.

The family was reportedly obsessed with status, and a family source told People: "Lori is used to getting what she wants. This is why she got in trouble in the first place. She got fixated on getting her girls into USC. It was absolutely a status thing."