“Lori is shocked and saddened that this is what her legacy is going to be,” a source told People of the "Full House" actress.
The insider added that Loughlin, 54, and husband Mossimo Giannulli didn't grasp the scope of what they were doing when they allegedly paid $500,000 for their daughters, Olivia Jade and Isabella, to get into University of Southern California (USC).
“You read the complaint and they look like criminal masterminds,” the insider said. “But they really didn’t know the legalities of what was going on. They’re not lawyers and they’re not experts. They were parents who simply wanted to make sure that their daughters got into a good school.”
The source claimed that Loughlin and Giannulli, 55, didn't know they were allegedly breaking any laws and believed that they were simply working with a consultant and didn't know the ins and outs of what the consultant — scam mastermind William "Rick" Singer — was reportedly doing.
“Calling in favors, donating money to the alumni association, hiring consultants. Those are all things that parents do. And so they gave money to this consultant, not entirely knowing everything that was going to be done," the source explained. "When it all fell apart, nobody was as surprised as they were that they were in trouble.”
The fashion designer and the former "When Calls the Heart" star are accused of paying Singer to get YouTube star Olivia Jade and aspiring actress Isabella into USC as crew team recruits. Neither Isabella nor Olivia Jade were rowers, but Singer reportedly told the couple to have the girls pose on rowing machines. Reports claimed that Olivia didn't even fill out her own application to the school.
Giannulli and Loughlin were each arrested in March and released on $1 million bonds.
They rejected a plea deal and were subsequently charged with additional counts of conspiracy and money laundering. The couple pleaded not guilty; if convicted, Loughlin and Giannulli each face up to 40 years behind bars.
Loughlin's attorney did not immediately return Fox News' request for comment.