Also, the school announced those same students' accounts have been suspended and will no longer be able to register for classes or obtain their transcripts.
USC said today it's blocking students associated with the scandal from registering for classes for now.
It did not say how many students are affected, but said those students have been notified.
"Following the review, we will take the proper action related to their status, up to revoking admission or expulsion", the school said.
The third student was also supposedly involved in the cheating scandal but her parents weren't indicted.
A criminal case announced last week by federal prosecutors in Boston alleges an admissions cheating scheme targeting USC and other prestigious schools including Stanford, Georgetown and Yale.
Mass evacuation underway as northern Australia braces for 2 cyclones
That includes creating barriers to ensure Indigenous cultural protocols are followed and people are spoken to in local languages. Meanwhile, another powerful category 4 cyclone was bearing down on the other side of Australia's northern rim.
The school fired senior associate athletic director Donna Heinel and water polo coach Jovan Vavic, who won 16 national titles. The university's president said its policy is to "rescind admissions of students who falsified their applications", as reported by CBS News.
The scheme involved wealthy parents, a pair of actresses, including Lori Loughlin, business leaders, and a college placement firm at the center of it all led by William Singer.
According to the Justice Department, parents often paid Singer between $250,000 and $400,000 - although some allegedly spent up to $6.5 million - to help their children cheat on standardized tests, create fake athletic profiles and bribe officials, in order to boost their chances of admittance.
"Full House" star #LoriLoughlin, her husband designer MossimoGiannulli, along with Desperate Housewives Star #FelicityHuffman have all been charged with conspiracy to commit mail fraud and honest services mail fraud.
Sixty students at USC have now been included in the #collegeadmissionsscam investigation. They claim that these students will be denied admission to the university.