In college, I loved this song called “Been Caught Stealing” by Jane’s Addiction.  It’s about a guy who has enjoyed stealing things his whole life and has only been caught once, when he was five years old.  Even his girlfriend loves thievery just as much.  The verse below describes their joy at having absconded with yet another haul and just having a good ol’ time as criminals:

We sat around the pile —
We sat and laughed.
We sat and laughed and we waved it into the air.
And we did it, just like that!
When we want something, man, we don’t wanna pay for it.

This image reminds me of why I’d often feel queasy as an financial aid officer, worried that Richie and Regina Rich were at home in their McMansion laughing about the $25,000 grant I gave the family while they pigged out on caviar and Dom Perignon with the accountant that got their taxable income to minus $12,500.
  
It took years to convince myself that if I’ve done everything I could possibly do based on a thorough review of legitimate information I had, 99 times out of 100 the best result will play out.  Indeed, most people do not enjoy stealing and do not sit, laughing, around a pile of ill-begotten loot.  And indeed, sometimes someone slips through the cracks  —  but you can’t pinpoint exactly why you shouldn’t give them what they qualify for, other than operating on a hunch.

But what do you do when you know for sure that someone cheated on their financial aid application?   How do you handle the one in a hundred who, through their dishonesty, basically steals money away from truly needy families? What to do when a family’s “been caught stealing?”

How do you know they cheated?

If you suspect a cheating situation, have proof and documentation whenever possible, such as the actual copy of the tax return they filed with the IRS, compared to the falsified version they gave you (this is indeed the value of collecting and using the IRS Form 4506 or 4506T).  This situation is too serious to rely on rumor, hunch, or intuition to make an accusation.  You have to have accurate information.  It’s okay to trust your instincts to ask for, or seek, more information about a case, but it’s not enough to accuse someone solely based on that.  You might submit the Form 4506 because you don’t ‘feel right’ about the 1040 they gave you, but you should stop short of accusing them of submitting the wrong form until you can prove it. Point out inconsistencies and ‘mismatches’ that are tangible and objective — such as differences between what the 1040 reflects versus what was provided on the PFS.

What to do about it?

Ensure Support of Key Players
At a minimum, be sure that the head, Financial Aid Committee members, and possibly the board chair (at the head’s discretion) are aware of the situation.  With this group, you should examine your strategy for assessing and delivering the consequences so that a group decision is made and supported by all the key decision makers.  You should also determine, as much as possible, whether there are possible contingencies or other circumstances that might warrant any potential ‘wiggle room’ in meting out the penalties.

Communicate Clearly, Firmly
Explain your position, using a clear, unequivocal statement of the facts that you’re able to document; provide opportunity for ‘rebuttal’ so that the family has a chance to clear the air, perhaps to correct a wrong assumption and/or clarify any misunderstandings.  Remind them that the PFS certification they sign states that they “recognize that intentionally providing false or inaccurate data may impact our ability to receive any financial aid and/or our ability to maintain a contract with a school.”  Consider whether your enrollment contract and financial aid letters have similar language. There should be no surprise when someone is exposed for falsifying information – they signed on to the consequences.

Speaking of That, Have Consequences
Once the dishonesty is confirmed, and with insufficient reason to overturn that confirmation, don’t waver on handing out the punishment decided by the stakeholders above.  Maintaining integrity of the aid process and your own credibility is paramount.   Among the options of consequences, you could do the following, starting from least punitive to most punitive:

Reduce the aid granted based on the actual true findings
(“you still qualify, but less than we initially gave you, but don’t let this happen again”)

Revoke or withdraw the current aid offer (“you can stay, but we cannot reward your deceit”)

Prohibit the family from applying for aid in future (“fool me once, shame on you…fool me twice, shame on me”)

Require the family to repay past aid (“were past applications equally fraudulent but just not caught?”)

Expulsion from school (“do we want clearly dishonest parents as part of our school community?”)

Of course, keeping the details of the matter private and confidential is critical.  However, it’s also important for the community to understand that there are ramifications for families who do not participate in the process honestly.  If the family is ask to leave the school or cannot return because the aid is withdrawn, consider the possibility that the reason why might become fodder for community chatter and be prepared to deal with it in a way that doesn’t expose the particulars but also confirms for others that falsifying financial aid information is not tolerated. 

Then, hopefully, someone who gets caught stealing once will not do it again to anyone else and will serve as an example to others.

Let's hear your story of how you handled someone you caught cheating on the financial aid application.  What did you do?