College financial aid scams impact low-income students: 'There's only so much to go around.' (via CNBCMakeIt)
The University of Illinois identified 14 students who used this drastic method to secure need-based aid after high school counselors started wondering why wealthy students were getting invited to special programming for low-income students. "They started asking questions, and that tipped us off to look deeper into our information, because this isn't something that we would have necessarily thought to look for otherwise," says Borst.
He stresses that while families may think they've identified a harmless hack, the practice has a direct impact on low-income students. "Financial aid resources are not unlimited," he says. "Whether we're talking about the federal government, the state government, or even institutional aid — there's only so much to go around."
Because federal and state Pell Grants are distributed on a first-come first-served basis, many low-income students don't receive the funds they qualify for. According to ProPublica, last year about 82,000 qualifying Illinois students did not get their $5,000 MAP grant for this reason. "When a family who has the ability to pay, but maybe not the willingness to pay, goes down this route they are taking money away from low- and middle-income families," says Borst.In addition to families, Borst says that private college counselors are also to blame. "There are some reputable counselors," he says, but warns families not to "follow the direction of someone who appears to be an expert, when in fact they are helping them manipulate the system.
Unethical college counseling was central to the Varsity Blues scandal. The case brought forth by the Justice Department alleges that William Rick Singer, founder of Edge College & Career Network, a for-profit college counseling organization, helped students cheat on SAT and ACT exams, bribed athletic coaches and administrators to pretend that students were athletic recruits and used a charity he had established to funnel the funds.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Illinois Lawmakers to Investigate College Financial-Aid LoopholeLawmakers are investigation a strategy in which families transferred the guardianship of their child to a third party. When the child applies for financial aid he or she doesn’t have to claim their parent’s income or assets.
Read more »
Here's how to get more college financial aid, without breaking the rulesSome parents are breaking the rules to get their childen more college financial aid. Here are some above-board strategies to pick up more federal, state and university aid.
Read more »
Imposter Guardians: The Latest College Admissions ScamJust months after the Varsity Blues college admissions cheating scandal was uncovered, a new scam has been revealed, this one involving parents gaming guardianship laws to gain need-based financial aid for their children.
Read more »
It costs $76,614 to go to NYU—but here's how much students actually payNYU estimates that the total cost of attendance for undergraduate students during the 2019-2020 school year is $76,614 but the average net price is closer to $39,935.
Read more »
It can cost over $66,000 to go to UC Berkeley—here's how much students actually payIt can cost over $66,000 to go to UC Berkeley—here's how much students actually pay. (via CNBCMakeIt)
Read more »
Russians Flock to Easy Loans as Income DipsMore ordinary Russians have come to depend on easy loans to buy goods, maintain a certain lifestyle or simply to survive. As some of them spend nearly 40% of their wages on loan repayments, top officials worry the borrowing bubble might blow up in 2021, sparking economic recession.
Read more »