Federal Student Aid (FSA) has a number of tools available to assess the compliance of institutions participating in the federal aid programs — and they’ve just re-generated and old one and added it to their current tool box. Members of FSA’s Office of Enforcement will pose as prospective students to evaluate an institution’s recruitment, enrollment, and financial aid processes as well as other practices used to encourage new students to enroll. Findings reported by a secret shopper can be used as the basis for opening an investigation. If it is found that the institution is engaging in deception, substantial misrepresentation, or other predatory recruitment and enrollment practices in violation of the Title IV regulations, the institution may be subject to corrective action(s), sanctions, or even be on the hook for loans discharged under the borrower defense to repayment program.
Additionally, FSA is inviting ‘knowledgeable sources’ — current or former employees, contractors, vendors, students, and anyone else with direct experience — to report potential violations of federal regulation.
If this feels like an attack on higher education, let’s put it in perspective. Like any industry, there are bad actors in our community and those institutions/individuals need to be regulated to ensure neither students nor tax payers are injured. However, FSA can’t selectively regulate institutions so the rules need to apply to all Title IV participants. And, most colleges and universities have nothing to worry about. Are you concerned for your campus? If so, read on for some steps you can take.
First, don’t try to go it alone. The enrollment process involves several different departments on campus and you’ll need everyone’s cooperation. Next, understand whether incorrect information is just out-of-date, wasn’t vetted and approved prior to use, or if it’s intended to deceive. It’s a much easier conversation to offer updated information for a web page than to suggest colleagues may be ‘gilding the lily.’ Even if the latter is the case, make sure everyone knows what the ramifications will be should the secret shopper review your recruitment, enrollment or financial aid process and find questionable consumer information being disseminated. Don’t give up if you face push back, go to the department head or the department head’s boss if needed. The simple truth is updating your website, re-printing materials and even re-training staff will be far less costly than going through an investigation or being sanctioned and held responsible for discharged loans. By the way, the electronic announcement invites “knowledgeable sources to submit tips and information about potential violations”. Our best advice to aid administrators at every level is to discuss your concerns with your supervisor or Department head before you report a potential violation. The alleged violation may be misinterpreted by you based on your level of expertise. If you remain confident in your position, be prepared to clearly articulate your position, logic and reasoning in your communication to the tip line.
If you’re not sure where to start to make sure your campus will pass a secret shopper review with flying colors, drop us a line at info@heag.us or visit our website www.heag.us. One of our compliance experts will be happy to point you in the right direction.
