TASFAA Community Blog
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We are at a turning point on federal student aid funding and I am writing to ask you to sign on to a simple statement of support that calls on our lawmakers to Save Student Aid.
Because of our nation's historic economic downturn, we've already seen $30 billion cut from our federal student aid programs. The Joint Select Committee on Deficit Reduction, also known as the Super Committee, has until Nov. 23 to come up with a plan to reduce the nation's debt. Federal student aid could very well be on the chopping block and students need your voice to defend the programs that grant access to postsecondary education.
As you know, this is an incredibly challenging time for students all over the country, including those you serve on a daily basis. The recession has driven more students back to campus to improve their skills and job prospects, and a lot of those students have higher economic needs. Meanwhile, federal and state governments have cut back their support. It is critical to preserve what financial aid is still available for deserving students so they can better qualify for the jobs that will help our economy grow.
As student aid administrators you see evidence of these situations everyday on your college campus. But Super Committee members and other members of Congress need to hear more-and they need to hear it from as many people as possible, particularly those of you who work directly with students.
That's why the Student Aid Alliance, a coalition of national higher education organizations representing thousands of campuses and millions of presidents, students, faculty and administrators has organized a campaign to Save Student Aid. The campaign will reach to out to all campus constituencies, encouraging grassroots involvement. As one of the founding members of the Alliance, NASFAA encourages you to join us in this campaign.
As the Super Committee's deadline nears, we need your help. Please sign our statement of support, expressing the opinion that for our country's short- and long-term economic health, student aid funding must be preserved. This is a simple and easy step to make your voice heard.
If you're interested in getting more involved after you've signed on, you'll see other options for actions you can take by visiting NASFAA's Save Student Aid Facebook campaign.
Your voice is powerful and students need it now more than ever. Please join your fellow administrators as well as the students from across the country in asking the Super Committee and our lawmakers to Save Student Aid.
Statement of Support link:
http://action.studentaidalliance.org/5371/save-student-aid-statement-support/
Publication Date: October 20, 2011
DCL ID: GEN-11-17
Subject: Fraud in Postsecondary Distance Education Programs - URGENT CALL TO ACTION
Summary: The purpose of this letter is to provide guidance to address potential fraud in the Federal student aid programs at institutions of higher education that offer distance education programs. This letter provides an overview of the fraud schemes that the Department's Inspector General (IG) detected, and recommends immediate steps that institutions can take to detect and prevent fraud. In this letter, we also describe further actions that institutions can take and that the Federal government is committed to taking, including increasing technical assistance to institutions of higher education, the convening of a Department-wide task force on distance education fraud, and plans for recommending legislative and regulatory changes to address the relevant issues.
Dear Colleague:
We appreciate the efforts that institutions routinely take to protect the integrity of the Federal student aid programs. Some of the fraud described in this letter was detected as a direct result of vigilant efforts pursued by institutions that have implemented comprehensive internal controls and fraud detection measures. Despite these efforts, more needs to be done by all institutions to prevent, identify, and report suspected distance education fraud in the Federal student aid programs and enable the successful prosecution of offenders. As evidenced by our recent work with the community on program integrity, we are committed to being a strong steward of the taxpayer investment in the student assistance programs and to ensuring their integrity. For these reasons, the Department determined a swift response was necessary and, through this Dear Colleague Letter (DCL), we are asking for your continued partnership to eliminate this and other attempts to defraud the Federal st udent aid programs. It is imperative that institutions comply with all existing statutory and regulatory requirements to disburse aid only to eligible students, to identify and resolve discrepancies in student information, to ensure that all requirements regarding "regular student" status are met, and to report any suspected fraud to the Department's IG. In doing so, your efforts will help curb these abuses and ensure that Federal student aid is provided to needy students as intended.
On September 26, 2011, the Department's IG issued a report about fraud rings operating on distance education programs offered by institutions participating in the Federal student aid programs (http://www2.ed.gov/about/offices/list/oig/invtreports/l42l0001.pdf). The IG's report identified an increasing number of cases involving large, loosely affiliated groups of individuals (fraud rings) who conspire to defraud title IV programs through distance education programs. These fraud rings generally target institutions with low tuition in the context of distance education programs and involve a ringleader who:
Obtains identifying information from straw students - individuals who willingly provide the information - including some who were incarcerated, by promising financial gain.
Completes multiple financial aid applications using the information collected (name, Social Security number, date of birth, etc.).
Applies for admission under the institution's open admissions program, where little or no third-party documentation is required.
Participates in the amount of on-line interaction necessary to establish participation in the academic program and secure disbursements under an institution's procedures.
Once the ringleader has submitted the Federal student financial aid application and completed enrollment at the institution, the institution draws down Federal student aid funds, deducts the institutional charges assessed the straw student, and disburses the credit balances to the straw student by check or debit card. Straw students then give a portion of the proceeds to the ringleaders while keeping the remaining portion. If needed to secure disbursements under an institution's procedures, a ringleader may also participate as the straw student in sufficient academic work to appear to be an eligible student.
The IG's report found that complaints about distance education fraud rings are expected to continue, given that distance education is the fastest growing segment of higher education. Institutions offer the front line of protection and are essential to the Department's efforts to thwart fraud and protect taxpayer dollars. As you know, accrediting agencies are required to review the policies and procedures institutions have in place to verify the identity of the students enrolled in those courses and programs (34 CFR 602.17(g)). Affected institutions should follow these reviewed processes to help detect efforts to defraud the Federal student aid programs. We also expect institutions to take steps necessary to ensure that students are academically engaged prior to disbursing Title IV student aid funds. If students do not begin attendance, Title IV funds must be returned (34 CFR 668.21(a)). We strongly encourage institutions that suspect potential fraud to question an appl
icant's intent to seriously pursue the academic program by requiring the student to demonstrate that he or she has an academic purpose in order to establish eligibility for Federal student aid. If a student does not demonstrate academic purpose or resolve other concerns regarding identity or eligibility, the institution should not disburse Title IV funds.
Detecting fraud before funds have been disbursed is the best way to combat this crime. We therefore seek the help of institutions and advise that you take the following additional actions to identify and prevent the kind of student aid fraud identified in the IG's report:
Implement automated protocols that monitor information in your student information data system to identify instances where a number of students -
Use the same Internet Protocol (IP) address to complete and submit an admissions application.
Use the same IP address to participate in the on-line academic program.
Use the same e-mail address to submit an admissions application.
Use the same e-mail address to participate in the on-line academic program Appear to reside in a geographic location that is anomalous to the locations of most students in the program.
Modify your disbursement rules for students participating exclusively in distance learning programs, which would immediately reduce the amount that fraud ring participants can receive. Institutions have the authority to:
Delay disbursement of Title IV funds until the student has participated in the distance education program for a longer and more substantiated period of time (e.g., until an exam has been given, completed, and graded or a paper has been submitted).
Make more frequent disbursements of Title IV funds so that not all of the payment period's award is disbursed at the beginning of the period.
Our recent program integrity rules include two additional requirements that help identify potential fraud. First, we now require institutions to have procedures in place to address what may appear to be a fraudulent claim of high school completion (34 CFR 668.16(p)). Since we now collect high school completion information on the Free Application for Federal Student Aid (FAFSA), institutions can use these procedures to help detect potential fraud. In addition, in the future, we may in our annual verification notice (which we publish in the Federal Register pursuant to recently-revised verification regulations found in Subpart E of 34 C.F.R. Part 668) specify certain additional items that would need to be verified, including high school diploma information and applicant identity for all or some of an institution's Title IV applicants who are engaged in distance education. The selection of these applicants for verification may be based on common addresses and other patterns and discrepancies noted in the OIG's investigations. Institutions are encouraged to verify identity of individuals whenever the institution, through use of similar methods and triggering events, finds cause for doing so as a best practice for preventing fraud.
The Department is taking this issue very seriously and has established a Department-wide anti-fraud ring task force, chaired by Jeff Baker, Director, Policy Liaison and Implementation in Federal Student Aid, to address the issues raised in the IG's report as well as emerging future threats. If you have comments and suggestions that you believe will help us address fraud rings or have specific concerns that do not rise to a level that you believe appropriate to refer to the IG, please contact the task force at FraudTaskForce@ed.gov or call 202-377-4340.
Finally, we have added sessions to the upcoming FSA Conference in Las Vegas scheduled for November 29-December 2, 2011, to more fully discuss the IG report and possible institutional responses. We plan to release additional guidance after those sessions and will also consider suggestions for additional statutory and regulatory changes to help institutions combat fraud and protect students and taxpayers from fraudulent activity.
Sincerely,
James W. Runcie
Chief Operating Officer
Federal Student Aid
Eduardo M. Ochoa
Assistant Secretary
for Postsecondary Education
TASFAA FALL TRAINING WORKSHOPS
Hello friends and colleagues! TASFAA and TSAC are once again partnering together to provide training opportunities for financial aid administrators that will take place in three locations across the state.
http://www.tasfaatn.com/Fall
Workshop West Union University Jackson, TN November 9th
Workshop Central Lipscomb University Nashville, TN November 14th
Workshop East South College Knoxville, TN November 15th
We have been asked by the Department of Education to share this letter recently sent to College Presidents with our members.
Click the link to view the attachment
Attachment 1: Gainful Employment Letter http://www.sasfaa.org/ListLock/fDhc6faES3SRZrs9.pdf
Clock Hour Definition
Under 34 CFR 668.8(k)(2) the Department formally defines what a clock hour program is for undergraduate programs. If your program meets the definition, then, for Title IV purposes, it is considered a clock hour program and all clock hour requirements apply. HOWEVER, policy recently clarified that 668.8(k)(2) does NOT apply to non-GE programs. So it would apply to nondegree programs at all school types and, at for-profit institutions, it would also apply to their degree programs.
I am stressing this since I know within my region there are some public schools that have been converting degree programs to clock hour programs for Title IV purposes since it met the new clock hour definition. Based on policy’s new guidance those degree programs at our public institutions would not have to administer Title IV aid in clock hours since they are not considered GE programs.
Gainful Employment
This is a reminder that ED will be hosting an upcoming Webinar on adding new GE programs. This training will take place on September 26, 2011. Please see the Dear Colleague Letter ANN-11-19 for more information.
Also, don’t forget that schools will be able to start reporting GE data through NSLDS as of September 26, 2011. Please make sure your school will be able to gather and report to ED all the required GE data by October 1 (2006/2007-2009/2010 data) and November 15 (2010/2011 data), respectively. For more information about reporting processes and timeframes please see the GE webpage at http://www.ifap.ed.gov/GainfulEmploymentInfo/index.html.
Net Price Calculator
Please don’t forget that all required schools must have a net price calculator up and running on their website by October 29, 2011. Please see the Department’s NPC webpage for further assistance - http://nces.ed.gov/ipeds/resource/net_price_calculator.asp
FSA Handbook Changes
Based on some recent questions I have been receiving, this is just a reminder that our publication group often moves items around or removes information within the FSA HDBK to clarify data or enhance existing sections. Please remember that just because a line item has been removed does not necessarily mean that the rule no longer applies. It may have been redundant, or moved to a section better suited to describe the topic. Any true changes in guidance will usually be accompanied by a CHANGE sign or a NEW sign designation. And as always, staying up-to-date with the entire FSA HDBK is a must to properly administer aid.
Hope everyone's September is going well. I am in the middle of renovating a kitchen and all of a sudden financial aid does not seem as difficult as picking out colors, tile, paint, appliances, etc. And somehow our final decisions all seem to be what my wife wanted in the first place. Of course that might be my subconscious kicking into survival mode and leading me down the path of least destruction.
Anyway, I have a few topics I wanted to share. For those schools with undergraduate programs subject to the new clock hour definition please pay careful attention to some updated guidance provided below.
I am stressing this since I know within my region there are some public schools that have been converting degree programs to clock hour programs for Title IV purposes since it met the new clock hour definition. Based on policy's new guidance those degree programs at our public institutions would not have to administer Title IV aid in clock hours since they are not considered GE programs.
Also, don't forget that schools will be able to start reporting GE data through NSLDS as of September 26, 2011. Please make sure your school will be able to gather and report to ED all the required GE data by October 1 (2006/2007-2009/2010 data) and November 15 (2010/2011 data), respectively. For more information about reporting processes and timeframes please see the GE webpage at http://www.ifap.ed.gov/GainfulEmploymentInfo/index.html.
Please don't forget that all required schools must have a net price calculator up and running on their website by October 29, 2011. Please see the Department's NPC webpage for further assistance - http://nces.ed.gov/ipeds/resource/net_price_calculator.asp
I hope you have a great weekend.
DAVE
David Bartnicki
Federal Training Officer
ED/FSA/Atlanta
FERPA and Your Students--A Beginner’s Guide
By Dave Bowman, Regional Marketing Director
Great Lakes Educational Loan Services, Inc
For schools, the Family Educational Rights and Privacy Act of 1974 (FERPA) details the transfer of rights to access educational recordsundefinedfrom the parents of your students to the students themselves. Under FERPA, all education records (except directory information, in most cases) are confidential, and cannot be disclosed unless the student consents or the request fits an exception outlined by FERPA.
While FERPA is a complex issue that requires research, here are a few things schools must know:
Know the Student’s Rights
The FERPA provides several rights to students with regard to their education records, including the right to access, review, and request amendment of their education records, and demand records be disclosed only with student consent. FERPA also gives students the right to file complaints against the school for disclosing education records in violation of FERPA.
Know the Parents’ Rights
Unlike students, parents do not have automatic access to their child’s education records even if their students are dependent students.
There are a few instances that do allow access to parents, including if the student has provided written consent. Under certain circumstances, as outlined in the FERPA, full rights may be given to the parent at the school’s discretion.
Know Your School’s Responsibilities
There are steps that schools must take to ensure that they are complying with FERPA:
•o Providing copies (or other arrangements) of applicable education records (exceptions outlined in FERPA) within 45 days of the receipt of the request.
•o Not charging a fee for the record search (but may charge a copying fee).
•· Know what to do when a student asks to amend a record. The school must:
•o Decide within a reasonable timeframe.
•o If approved, amend the record as requested.
•o If denied, inform the student or parent of their right to a hearing, and
•o Allow the student or parent to insert a statement in the record, if denied after the hearing.
Know Where to Learn More
FERPA compliance help is available. You can email your compliance questions to the U.S. Department of Education at ferpa@ed.gov.
FERPA information is available from several sources:
You may also wish to consult your campus legal counsel, as this article is intended to provide general FERPA information only.
By following these guidelines, and becoming familiar with FERPA, schools can ensure that the privacy of students’ confidential education records is protected.
Contact Us: administrator@tasfaatn.com
