Thursday, May 12, 2011

Are You Committing FAFSA Fraud to "Save All You Can?"

"Saving all you can..." For what? That new car to drive to college with or that first Spring Break trip you've been saving up for?

FAFSA Fraud has severe penalties, probably far greater than the FinAid difference you will get by lying to yourself, and both the government and your intended graduate school. Then, if found out, your record of fraud will still be there when your children come around asking for aid, it will become part of your permanent family record, not just your own, the government will never allow you to co-sign any federal or state loan with such a record.

And then comes the question of your own ethical integrity. You will always know you stole the money. "They'll never find out" really isn't as true as you might think. There are new programs designed to detect fraud and the greater burden is placed on the college which has more to lose by not reporting you.

Stand up and act ethically from the start. Don't start off your professional career with lies, they will haunt you forever...and set a pattern of behavior that can dog you well into your life beyond graduate school.

The last time I checked, taking money under false pretenses is clearly defined as fraud and theft. As an older graduate (I hope you're not considering law school) you've seem as though you've been financially harmed before and are seeking systemic retribution.

Wednesday, May 11, 2011

Is there a way to anonomously report fraud regarding college financial aid?

Question: I am aware of someone who is fraudulently reporting information about her son in order to receive more government assistence for his college education. Is there a way I can report this anonymously.
It really frosts me to see someone take advantage of the system like this since the programs were not designed to be used this way.
Thank you everyone!
Answer:  I agree: it’s very frustrating, since it’s taxpayer money (yours and mine) that they’re taking, undeservedly. You can report Student Aid Fraud to 1-800-MIS-USED. Naturally, there’s no guarantee that that anyone will be able to stop this person from abusing the system, but it’s a start.
You can rest a little easy knowing that applications are selected randomly for a process called “Verification” (some schools require everyone to partake in this process, submitting tax forms for the school to scrutinize). It’s possible that this person will eventually get caught.

Tuesday, May 10, 2011

False Information On The FAFSA - It simply doesn’t make sense.

Many people resort to FAFSA fraud, in order to eke out a few extra dollars.
If you’re caught receiving help due to fraudulent information, you lose all benefits, must pay back any money you’ve received, and may face further fines and fees.
That’s if it’s an innocent mistake. If you’re found to have knowingly filed false info, the penalty is $20,000 and/or prison.
What’s more, this isn’t like taxes. A miniscule number of tax returns go through the audit process; a minimum 1/3 of FAFSA applications go through an audit, and some colleges audit every single one.
Lying on your FAFSA is a low-reward, high-risk endeavor. Even being careless on your FAFSA carries huge penalties for no gain. It simply doesn’t make sense.

Monday, May 9, 2011

Is it possible to to file for FAFSA without your parents tax form?

The only way to NOT file without your parents income is to be 24 years old, a veteran, married, an orphan, a ward of the court, have kids or have a bachelors degree. Until then, you'll need your parents taxes.

It does not matter if they will be paying for your education, if you dont live with them, or if they claim you on your taxes, or even if you support yourself.

Sorry.. federal rules.

Friday, April 22, 2011

What Happens If You Deliberately Don't Report Assets on the FAFSA?

Failure to report assets on the Free Application for Federal Student Aid (FAFSA) is fraud. It doesn’t matter whether you keep the money in a safety deposit box or stuffed under your mattress. Failing to report the money is still fraud, since you will be making a false statement on the FAFSA in response to the question about the “total current balance of cash, savings and checking accounts.”

The penalties for providing false information on the FAFSA are severe. Per section 490(a) of the Higher Education Act of 1965 [20 USC 1097(a)], the penalties include a fine of up to $20,000 and/or up to 5 years in prison. These penalties apply both to attempts to receive and to the actual receipt of Title IV federal student aid through fraud, false statement or forgery. (The FAFSA also includes the following signing statement: “If you purposely give false or misleading information, you may be fined up to $20,000, sent to prison, or both.”) You will also be required to return all student aid, making it much more difficult for you to pay for college. Some colleges will expell students who submit falsified financial aid applications, as it is a violation of their honor code.

Thursday, April 21, 2011

What's Wrong With FAFSA Fraud

Unfortunately it hurts others too. If she becomes fraudulently eligible for federal pell grants etc. then that takes away money that others deserve, and if she accepts financial aid provided by the college, again, that is money that could/should go to other eligible students who meet the actual criteria. We all know there isn't enough money to go around to meet everyone's actual "need", so there are definitely others who are impacted by this manipulating/cheating of "the system".

It's one thing suspecting that someone fudged their numbers, but you are in a much more delicate situation when your sister-in-law flat-out told you it was a lie. I don't have any advice for you, but stories like this definitely bother me. Grrrr.....

What happens if you lie on FASFA?

Lying on a federal application is committing fraud and will put you in serious trouble when you get caught. You can be fined, receive jail time, lose any chance of getting financial aid in the future, no longer be allowed to attend the school you want, or a multitude of those things.

When you electronically sign the FAFSA there is a statement that reads something like, "Under the penalties of perjury I affirm this information is true...." If you knowingly submitted incorrect information that is fraud and you can be subject to paying back all of the money you received as a result of the fraud as well as being subject to fines, jail or both. Here is a link to a website that discusses fraud on the FAFSA