The U.S. Department of Education has announced important steps to make sure federal student aid money is spent correctly and responsibly. Recently, an investigation found nearly $90 million was wrongly given to people who were not eligible, including thousands who had already passed away. This is a serious issue because federal student aid programs use taxpayer money, so protecting these funds is a top priority.
Ensuring Accountability in Student Aid
U.S. Secretary of Education Linda McMahon said that every part of the student aid process—from filling out the FAFSA form to paying back loans—needs to have strong checks to protect taxpayers’ money. The previous administration, led by President Biden, was less strict on these rules because of their student loan forgiveness plan. Now, the Department of Education is restoring important protections and improving how they manage student loans to serve borrowers better and hold people accountable.
Stopping Wrong Payments and Fraud
One big problem found was that more than $30 million was sent to students who had died, over the last three years. To fix this, the Department is working closely with the Social Security Administration to check real-time data and stop money going to dead people or identity thieves.
Another issue involved people with temporary immigration status called parole. These individuals are not immediately allowed to receive federal student aid, so the Department is now working with Homeland Security to make sure only eligible people get aid.
Tools to Prevent Errors and Fraud
In May, the Department restarted an important process called post screening for FAFSA applications. This helps catch mistakes, like students who have already reached their lifetime limit for Pell Grants, so they don’t get more aid than allowed. Before restarting this process, about $10 million in wrong loan payments were made.
Starting in March, the Department also began flagging FAFSA applications that seem suspicious or may involve someone using another person’s identity. This helped find almost $46 million in wrongly given loans and grants by early February. The Department uses special data tools to detect these problems and works with law enforcement to stop fraud.
Help and Information for Students and Families
To protect students and their families, the Federal Student Aid office offers helpful resources about avoiding scams and identity theft when applying for aid. Their website, StudentAid.gov/scams, explains how to stay safe and what to do if someone uses your information without permission.
