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Student Financial Aid Fraud Prevention

Purpose

This policy provides guidelines for the prevention, identification, investigation, and resolution of actual or suspected financial aid fraud at ºÚÁÏ³Ô¹Ï ("The College").

Definition of Financial Aid Fraud

• Financial Aid Fraud is any situation where an individual falsifies information to qualify for federal, state, or institutional financial aid. This includes, but is not limited to, submission of false documentation, misrepresentation of dependency status, or identity theft. Examples of financial aid fraud include:
• Enrolling in classes and accepting financial aid based on enrollment with no intent to complete said classes.
• Reporting untruthful information, or failing to report truthful income/asset information, on the FAFSA or other financial aid documents.
• Using or attempting to use another person's identity or identifying information.
• Creating fake (a.k.a. "ghost") accounts.
• Applying for admission using fake credentials which include social security numbers, personal and student identification numbers, financial aid information, date of birth, driver's license number, address, and telephone number.
• Submitting false or misleading information on the FAFSA or any supporting financial aid documents.
  • Misreporting income, household size, or dependency status.
  • Providing forged or altered documentation.

Policy

1. Education and Awareness:

• The College will provide ongoing training to relevant staff regarding fraud detection and prevention.
• Communication of financial aid regulations, ethical expectations, and consequences of fraud will be shared with students via the college website, counseling sessions, and orientation materials.

2. Detection of Fraudulent Activity

• Employees in Admissions, Records and Registration, Financial Services and Financial Aid offices will monitor student records for indicators of potential fraud, including but not limited to the following "red flag" indicators:
  1. Inconsistent or suspicious documentation.
  2. Frequent changes in address or banking information.
  3. Multiple aid applicants under the same address or phone number.
  4. Credible notice that an individual has been a victim of, or has perpetrated, identity theft.
  5. Credible notice that a particular account is fraudulent.

3. Verification of Identity for High-Risk Cases

When a student's account is flagged due to suspicious activity, an identity verification hold may be placed on a student's account. An identity verification hold prevents the student from registering and prevents financial aid from being disbursed. To lift the identity verification hold, students may be required to:

1. Verify their identity in person.
2. Provide additional information including but not limited to:
   1. Bank Statements.
   2. Tax Returns.
   3. Official transcripts from other institutions of higher education that the student has previously attended.
   4. Official High School Transcript or GED from the issuing entity.
   5. Birth Certificate.
   6. Social Security Card.
   7. Proof of residency at the address listed on the student's college records.
   8. Valid Passport.
   9. Unexpired State Issued Photo ID.

4. Reporting Suspected Fraud or Identity Theft

• Internal Reporting: Staff and faculty who suspect fraud or identity theft must report the incident by completing the Suspected Student Fraud form located on My Macomb.
• External Reporting: Confirmed: Confirmed cases of fraud or identity theft will be reported to relevant authorities, including the Office of Inspector General (OIG), local law enforcement, and applicable state agencies and the college's auditors.
• Student Notification: If a student's personal information is compromised, the college will notify the student promptly and provide guidance on steps they can take to protect themselves (i.e., filing a police report and contacting credit bureaus and their banking institutions).

5. Enforcement

Violations of this policy may result in severe consequences, including but not limited to:

• Immediate suspension of financial aid awards and disbursements.
• Recovery of any funds obtained through fraudulent means, including collection efforts or garnishment of future earnings.
• A hold being placed on the student's account.
• Disciplinary action as outlined in the Student Code of Conduct
• Civil or criminal sanctions.

6. Roles and Responsibilities

• Admissions, Records and Registration, Financial Aid, and Financial Services are responsible for implementing this policy, conducting identity verifications, monitoring fraud indicators, and reporting suspicious activity.
• The IT Department ensures the security of systems and collaborates with members of the College's Fraud Task Force members.
• College Police conducts investigations in collaboration with the College's Fraud Task Force members and reports findings to external authorities, as necessary.
• Fraud Task Force will provide updates to President's Council and the Board of Trustees on potential fraud cases.
• Students are expected to provide truthful and accurate information on all financial aid and admission documentation and report any suspicious activity involving their personal information.

Approved by President's Council
June 16, 2025