Institutions must have appropriate internal controls to prevent, detect, and report suspected fraud or abuse of federal financial aid funds. An October 2011 Dear Colleague Letter from the U.S. Department of Education provides some guidance to address potential fraud in student aid programs at schools that offer distance education. More recently this past February, the Office of the Inspector General (OIG) issued its final audit report titled, "Title IV of the Higher Education Act Programs: Additional Safeguards Are Needed to Help Mitigate the Risks That Are Unique to the Distance Education Environment."
The report includes a number of recommendations to the Department of Education and to accreditors related, for example, to the frequency of financial aid funds disbursements, methods for student verification, definitions of academic attendance, etc.
Rio Salado College and the University of Phoenix have been dedicated in addressing how to identify early-on non-legitimate students or fraudsters, and at the same time, not create additional hurdles for legitimate degree-seeking distance education students. The fraud prevention approaches cut across the various administrative functions of the institutions. Some procedures may have a technology component, other strategies may relate to course design and methods of assessment, and other actions may begin long before the fraudulent student ever logs into his/her online course. Representative from our two guest institutions have valuable lessons to share. If your institution has not been impacted by this problem, it may in the future.
Director, Ethics and Compliance Investigations,
Apollo Education Group, Inc.
Vice President of Student Affairs and Advancement,
Rio Salado College
Associate Dean of Enrollment Services,
Rio Salado College
University of Louisiana at Lafayette