Federal officials announced last week that they’re working to prosecute several dozen people for fraudulently accepting more than $770,000 in federal aid at 15 schools across the state. Santa Barbara City College was one of those schools, and two of the 21 suspects allegedly recruited “straw students” who didn’t attend class to apply for federal aid and pocketed the money.
A joint statement was issued Sept. 18 from Benjamin Wagner, U.S. attorney for the Eastern District of California, and Kathleen Tighe, inspector general of the U.S. Department of Education’s Office of Inspector General, announcing that an indictment had been issued.
“Federal student aid exists so that individuals can make their dream of a higher education a reality, not for criminals to use as a personal slush fund,” Tighe said in the statement.
The schemes have mainly targeted lower-cost institutions because the federal student aid awards are sufficient to satisfy institutional charges such as tuition, and result in disbursement of the balance to the student for other educational expenses, such as books and living expenses.
That balance is what the fraud ring participants seek, the statement said, and they have no intention of pursuing a degree or credential, and many times don’t have a legitimate high school diploma or GED and thus aren’t eligible to receive federal student aid.
Shauna Marie Fabrega, 32, of Palmdale, is alleged to have recruited people to act as straw students, who did not attend classes, to apply for federal student aid funds at Santa Barbara City College, as well as Bakersfield College and Cerro Coso Community College. As a result, the Department of Education lost more than $70,000.
Another woman, April Lynn Myles, 35, of Lancaster, also is accused of recruiting people to act as straw students who never went to classes and to apply for FSA funds at SBCC and Bakersfield College. She enrolled herself in courses at both colleges even though she wasn’t eligible because she didn’t graduate from high school, and the Department of Education lost more than $80,000.
SBCC officials told Noozhawk that they’ve been watching the issue closely.
Brad Hardison, director of financial aid at the college, said he was notified in 2010 that there was an investigation going on surrounding the students, and gave records to the U.S. Department of Education and the OIG.
He said community colleges in the state have been a target because they have low fees, and since state residents from California get a fee waiver for community college enrollment costs, that money goes to the student.
“That’s a good thing for most of our students because that helps them pay for books and living expenses,” Hardison said, adding that since the state has the largest educational system in the world, he wasn’t surprised by the indictment. “As I’ve talked to all my other financial directors in the state, this has been going on for years and years.”
The department was working to stem fraud even before the cases came out, according to Allison Curtis, associate dean of Educational Programs, Admissions and Records.
It’s a nationwide trend and “is not unique to Santa Barbara City College,” she said.
SBCC has developed a program through its IT department that looks at different anomalies in the data and flags records that should have a closer look from staff.
In addition to SBCC’s specific measures, the Department of Education is taking more steps on its end to identify fraud.
Starting next year, SBCC will be asking students to verify their high school diplomas, present photo identification when enrolling, and must sign a statement of educational purpose, according to Hardison. If they’re applying for online classes, they’ll have to have that statement notarized.
It’s a small group that abuses the system, and most students benefit from the aid, said Dr. Ben Partee, dean of Educational Programs.
“We take this very seriously, because it is a minority, and we don’t want that to harm the majority of students and all the pluses of financial support,” he said.
— Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.
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