3.3.8 Financial Fraud Policy

Reason For Policy:

In recent years, Federal financial aid has experienced an increase in financial aid fraud, particularly with respect to distance education. An institution without effective fraud prevention policies risks disbursing aid to students who have no intent on completing coursework, thereby harming the institution and its students by increasing the cohort loan default rate, increasing receivables that most likely will never be recovered, and further failing in its responsibility as a steward of the taxpayer investment in the student assistance programs. Increasing loan default rates can lead to action by the DOE to disallow the University’s ability to receive and administer aid based on the inability to prove administrative capability. This policy establishes procedures to ensure compliance with existing statutory and regulatory requirements governing financial aid and the student payment process.

Policy Statement:

Identity Theft

Individuals who use personal identifying information of other people to apply for admission to college, receive financial aid and then enroll in classes are committing identity theft. Often, the victimized student is not aware that they have been enrolled in classes, and the financial aid funds in their name are sent to the individual who is perpetrating the fraud. This frequently results in the victimized student being left with unpaid debt at the institution and with the U.S. Department of Education due to student loans that were obtained in their name. 

Financial Aid Fraud

In order to protect the integrity of its federal Title IV, State of Georgia, and Piedmont University institutional financial aid programs, Piedmont University complies with all existing statutory and regulatory requirements to disburse aid only to eligible students, to identify and resolve discrepancies in student information, to ensure all requirements regarding the regulatory definition of “regular students” status are met, and to report any suspected fraud to the Office of the Inspector General of the U.S. Department of Education. To that end, Piedmont University actively monitors, reviews, and reports any suspected behavior or activity to fraudulently secure financial aid funds.

Although all Piedmont University departments (academic and administrative) share responsibility for preventing fraud, the Office of Financial Aid and the Student Accounts Office are responsible for monitoring and resolving discrepancies in the information received from different sources with respect to a student’s application for financial aid and/or financial payments. If it is suspected that a student, employee, or other individual has misreported information and/or altered documentation to increase student aid eligibility or to fraudulently obtain federal funds, those suspicions will be reported, and any supporting evidence will be provided to the Department of Education’s Office of Inspector General. In addition, a student who attempts to obtain financial aid by fraud may be referred to the Office of Academic Affairs or his/her designee for possible disciplinary action and may be suspended from receiving financial aid. Employees who assist with fraudulent misrepresentation or misinformation will be subject to the University’s established disciplinary procedures.

All credit-bearing courses and programs offered through in-person and distance learning methods must verify that the student who registers for a distance education course or program is the same student who participates in and completes the course or program and receives academic credit. Online course developers and instructors must provide a substantive means of determining participation in a course to facilitate the accurate completion of course roster verification.

Procedures:

Undergraduate Admissions Office

• Initial rules in place:
  • Only accept transcripts from school counselors, school registrars, legitimate websites
  • CAPTCHA is activated on applications so students cannot create accounts on a VPN website
• When a fraudulent account is suspected:
  • Raise awareness to appropriate department head.
• Initiate account inspection
  • Have a student call and/or email
  • Shut account access down
  • Ask students for form of ID
  • Inspect IP address access
• If account has been accepted and sent to Colleague:
  • Notify the IT department
  • If any further steps were taken, notify the proper departments

Graduate Admissions Office

When fraud is suspected:

• Flag the Application
  • Note concerns in the internal system or admissions workflow
• Initiate Verification:
  • Please schedule a Zoom meeting with the applicant to verify their identity
  • Government ID Verification: Applicants may submit a copy of a valid government-issued photo ID—such as a state ID card, driver’s license, or passport—either by uploading it through the application portal or emailing it directly to the Office of Graduate Admissions.
  • Require official transcripts to be sent directly from institutions
  • Contact listed references
  • Use official score verification systems (e.g., GRE, GMAT portals)
  • Confirm accreditation of previous institutions
  • *Utilize Turnitin or other plagiarism detection tools for personal statements and essays
• Notify Appropriate Departments
  • Alert the Director of Graduate Admissions
  • Notify Financial Aid, Registrar, and Student Accounts as needed
• CAPTCHA is utilized by TargetX and the CAS Application portals to verify that the user is a human and not an automated bot

* Utilizing Turnitin can assist the Office of Graduate Admissions in identifying potential plagiarism or inauthentic content within admissions essays.

Please refer to Graduate Admissions Office SOP – Fraud – AI Detection – BOT Applicants for full detail.

Financial Aid Office:

After investigating the situation, if the Director or his/her appointee believes there is a fraudulent situation, all information must be forwarded to the Office of Inspector General of the Department of Education or the local law enforcement agency.

If the decision is made by the Director or his/her appointee to pursue the possibility of denying or canceling financial aid, a written request to make an appointment is sent to the student.  If the student does not make an appointment, the Director may:

 ·       Not process a financial aid application until the situation is resolved satisfactorily.

 ·       Not award financial aid

 ·       Cancel financial aid

 ·       Determine that financial aid will not be processed for future years

All processing of the application or disbursement of funds shall be suspended until the Director has made a determination as to whether the student shall be required to make an appointment.

Fraudulent situations should be reported to the hotline of the Department of Education Inspector General at (202)755-2270 or 1-800-MIS-USED.

Student Accounts Office
If fraud is suspected, Student Accounts will work closely with Admissions, Financial Aid, Registrar & Information Technology to check registration, class participation, log-in access & usage of University resources. Notification will be sent to our payment processor.

• Woking with Admissions and Financial Aid
• Check registration
• Class Participation Check
• Notify IT – tracing IP addresses

Refunds:

Refunds will be processed using the original payment method used to make a payment unless federal financial aid is received after payment is made. If no federal aid funds have been received, the refund will be processed to the credit card/debit card or bank account used to make the original payment. If a check was used to make the original payment, a paper check or ACH (direct deposit) refund will be issued following University policy.

If federal financial aid is received (last in), refunds will be processed by paper check or ACH (direct deposit) following University policy.

See Financial Fraud Agreement found in Student Accounts/Finance.

Office of the Registrar

The Registrar’s Office verifies student enrollment through the roll confirmation process after drop/add at the beginning of each semester and the beginning of each eight-week term. “No show” (never attended) students are removed from classes as they are reported by faculty. An R2T4 is completed at the end of the term for any students with all F grades. Students reported as no show (never attended) at end of term grading are removed from class. Student accounts and financial aid are notified when students are removed for non-attendance.

Students who are flagged in National Student Clearinghouse (NSC) enrollment submission error reports as having a social security number that is in use by another student in the NSC system will be contacted and asked to provide a copy of their social security card in order to resolve the error with NSC. These students may be flagged to block future enrollment until a copy of the card is provided. Students who fail to provide a copy of their social security card to resolve the error may be reported to the Suspected Financial Fraud group on Teams. The registrar’s office may also reach out to faculty to verify attendance again for these students.

The Registrar’s Office collaborates with the Admissions, Financial Aid, and Student Accounts offices to investigate suspicious enrollment patterns, validity of student records, and inconsistencies in student information. The office will report suspected fraud to the appropriate institutional representative.

Academic Faculty

Strictly adhere to the University’s e-alert procedures by issuing a Substantive Participation notification through the Starfish Alert System that identifies students actively participating in courses.  Instructors must take necessary steps to ensure that students are academically engaged. If a student is not determined to be academically engaged, the faculty member will notify the Office of Registrar’s Office immediately as evidence of academic engagement is a prerequisite to disbursement of Title IV student funds. Registrar’s Office will notify Financial Aid upon confirmation.

Information Technology

Once the IT Department has been notified of a suspected or potential fraud, we will use the resources available to us (e.g., Microsoft Entra, firewall logs, etc.) to find any useful information in determining whether the person is/was who they claimed to be. This can be done by comparing the source IP address location with the known location of the person they claim to be. We will also run a message trace to determine if the account was used to impersonate the user by sending and receiving emails from university personnel. If it is determined that the activity was fraudulent and the person has gained access to an email account, we will end the session token. then reset the password and multifactor-authentication methods. We will then report our findings back to the original reporting party.