Financial Aid Fraud, Student Attendance, and Foreign Students

This morning's news about Dolores Cross, the former president of Morris Brown College here in Atlanta, got me thinking about recent changes in federal student aid policy. Dr. Cross was sentenced to five years of probation and a year of home confinement for her role in fraudulently obtaining millions of dollars in federal student aid. That seems like a light sentence, given that she was actually convicted of embezzlement, so perhaps the judge felt some sympathy with her. He did note in justifying the light sentence that Dr. Cross did not profit personally from the crime. It also seems as though the federal prosecutors made a bargain with the real devil in this case, something that they do all too frequently these days. The prosecutors had already arranged a similarly light sentence for Parvesh Singh, who was the college’s financial-aid director when the fraud was committed and testified against Dr. Cross.

While I know that there has been a great deal of regional attention to the Morris Brown scandal, it does not seem to have garnered much national press or played any major role in federal financial aid policy. The reforms of federal law designed to take care of fraud in financial aid were put through in 1998 when the Higher Education Act of 1965 was amended. Those reforms were advocated on the basis of several key incidents which occurred prior to 1997, summarized by Inspector General Thomas Bloom in a speech to the House Subcommittee on Labor, Health and Human Services, and Education.

As a recently minted college teacher the most burdensome change in federal policy affecting me has been the ritual of "no-show" reporting. I did not have to report "no-shows" when I first started teaching college classes in 2003, and it was not yet in force in Spring, 2004, when I taught some large lecture sections in which it would have been really painful to do so. The "no-show" reporting evidently came down from the federal government between the 1998 reforms and the more recent "reauthorization" of the Higher Education Act this past spring. A quick Google search brought up references to the "Student and Exchange Visitor Information System" of the Bureau of Immigration and Customs Enforcement. There was a particularly detailed explanation of this system given to the Subcommittee on Immigration, Border Security, and Claims of the House Judiciary Committee by Johnny N. Williams of the Department of Homeland Security. So "no-show" reporting is apparently a response to the events of September 11, 2001.

The responses to financial aid fraud do include detailed rules for the amount of student aid that may be awarded to a student if they withdraw before the end of the semester. The recent revisions were prompted in part by the disruptions caused by Hurricane Katrina. Congress also allocated more money to the Pell Grant rather than to loans. This seems odd since many of the cases of fraud were actually in the Pell Grant program, and that is also what is directly affected when a student is reported as a "no-show."