You may have seen recent news articles—latimes.com/california/story/2021-09-01/california-college-financial-aid-scam-fake-students and nytimes.com/2021/09/01/education/california-college-financial-aid-fraud.html—reporting that some institutions in California have detected atypical enrollment patterns that suggest attempts to obtain financial aid fraudulently. The Department is working with law enforcement partners and institutions to stop the suspected student aid fraud and protect individuals and the federal student aid programs.
While that work continues, we want to remind institutions about your responsibilities to identify and prevent fraud, and we provide some recommended actions.
Identifying and preventing identity theft is and remains a key goal of the student aid verification process. For specific guidance, refer to the Application and Verification Guide in the 2021–22 Federal Student Aid Handbook.
In a July 13, 2021 announcement, the Department issued a waiver of certain verification requirements in order to provide relief to students and colleges facing challenges resulting from the COVID-19 emergency while retaining a strict focus on identity and fraud. In accordance with that policy, requirements remain for institutions to verify identity.
Further, institutions maintain and should exercise the discretion to select students for other types of verification according to consistently applied institutional policies.
In reference to recent news articles, here are recommended actions for all institutions:
Be on the lookout for unusual FAFSA and/or enrollment patterns that may indicate fraud. Where possible, the Department will release additional information to support institutions’ efforts to identify fraud.
Conduct required identity verification and any additional identity verification deemed necessary.
The Department will provide additional information as it becomes available.
Questions about the information in this Electronic Announcement can be sent through the Customer Support form in the FSA Partner Connect Help Center. To submit a question, complete the form, and select “General” as the topic.