Inside Lori Loughlin's family's reaction to college bribery scandal: 'It's been mortifying'

Though Lori Loughlin and her family have yet to publicly address their alleged connection to the massive college admissions bribery scheme announced this week, sources close to the famous family are shedding light on how they're coping with their lives being upturned by the scandal.

Loughlin and her husband, Mossimo Giannulli, allegedly paid $500,000 for their daughters, Isabella Rose, 20, and Olivia Jade, 19, to get into the University of Southern California on the false pretenses that they were recruited for the school's crew team. Both parents were arrested this week and subsequently released on $1 million bonds.

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In addition to professional fallout from the scandal, which has so far included Loughlin being dropped from the Hallmark Channel and Jade being dropped by Sephora, the family has experienced some major personal turmoil as a result of the situation, too.

"Lori and Mossimo are finding out quickly who their real friends are," an insider told People. "It's not like they are the victims of a crime. They are the crime. Many of their friends don't want to be associated with them right now. Their friends are shocked at the allegations."

"This issue is shocking and greatly saddens many people," another source told People. "I've heard she is devastated, and the whole family wants to hide from the world. People have sort of been in awe of how Lori has been able to do it all and articulate so well."

The first source also explained that the couple's hopes for their daughters were always different from those of theirs. While Loughlin and Giannulli, who were described as "very competitive parents" who "like to show off," desperately wanted their children to go to USC, Olivia and Isabella were never particularly passionate about their educations, with Olivia instead being focused on growing her social media and YouTube presence.

"Olivia and Isabella’s personalities were always very different from their parents. They are average students. They have never been obsessed with school and didn’t seem to care that much," the insider explained. "They attended school because their parents made them. Their focus was never about getting straight As. It was always clear that it was the parents that pushed them to go to school. Olivia always talks about her vlog. This is her passion. She never really understood why she needs to go to school."

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TMZ reported on Thursday that the sisters have decided that they will withdraw from USC in an effort to avoid being expelled and dodge the "vicious bullying" that they think they'd be subject to if they were to return to school.

A source close to Isabella and Olivia told ET Online that they're "both devastated by what's happened. It's been mortifying and frightening for them. They love their parents dearly and realize they only wanted the best for them, but they are starting to realize how very serious the charges [against] their parents are at their expense."

In addition, the social media influencers "never expected their parents to be charged for any crime, let alone one related to them. They've always seen themselves as a good, honest family that works hard and follows the rules, but everything changed overnight. The reality of all of this has been devastating."

Though the Isabella and Olivia were not charged in connection to the scheme, it's still unclear whether or not either of them explicitly knew about the bribery scheme. That being said, both women allegedly posed for staged photos on rowing machines to make themselves look like more legitimate rowing recruits, despite the fact that neither participated in crew in high school.

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The ET insider also noted that, though Olivia had very little attachment to going to college and had said as much in videos posted to her public YouTube page, the reported decision to pull both sisters out of USC is much more tough for her older sister.

"Bella had many close friends at USC and had built a life at the school," the source said. "They are both so worried about their parents and the repercussions. They realize how serious the charges are and feel helpless."