[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1455 Enrolled Bill (ENR)]

        S.1455

                       One Hundred Sixth Congress

                                 of the

                        United States of America


                          AT THE SECOND SESSION

           Begun and held at the City of Washington on Monday,
             the twenty-fourth day of January, two thousand


                                 An Act


 
   To enhance protections against fraud in the offering of financial 
        assistance for college education, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``College Scholarship Fraud Prevention 
Act of 2000''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
        (1) A substantial amount of fraud occurs in the offering of 
    college education financial assistance services to consumers.
        (2) Such fraud includes the following:
            (A) Misrepresentations regarding the provision of sources 
        from which consumers may obtain financial assistance (including 
        scholarships, grants, loans, tuition, awards, and other 
        assistance) for purposes of financing a college education.
            (B) Misrepresentations regarding the provision of 
        portfolios of such assistance tailored to the needs of specific 
        consumers.
            (C) Misrepresentations regarding the pre-selection of 
        students as eligible to receive such assistance.
            (D) Misrepresentations that such assistance will be 
        provided to consumers who purchase specified services from 
        specified entities.
            (E) Misrepresentations regarding the business relationships 
        between particular entities and entities that award or may 
        award such assistance.
            (F) Misrepresentations regarding refunds of processing fees 
        if consumers are not provided specified amounts of such 
        assistance, and other misrepresentations regarding refunds.
        (3) In 1996, the Federal Trade Commission launched ``Project 
    Scholarscam'', a joint law enforcement and consumer education 
    campaign directed at fraudulent purveyors of so-called 
    ``scholarship services''.
        (4) Despite the efforts of the Federal Trade Commission, 
    colleges and universities, and nongovernmental organizations, the 
    continued lack of awareness about scholarship fraud permits a 
    significant amount of fraudulent activity to occur.
SEC. 3. SENTENCING ENHANCEMENT FOR HIGHER EDUCATION FINANCIAL 
ASSISTANCE FRAUD.
    Pursuant to its authority under section 994(p) of title 28, United 
States Code, the United States Sentencing Commission shall amend the 
Federal sentencing guidelines in order to provide for enhanced 
penalties for any offense involving fraud or misrepresentation in 
connection with the obtaining or providing of, or the furnishing of 
information to a consumer on, any scholarship, grant, loan, tuition, 
discount, award, or other financial assistance for purposes of 
financing an education at an institution of higher education, such that 
those penalties are comparable to the base offense level for 
misrepresentation that the defendant was acting on behalf of a 
charitable, educational, religious, or political organization, or a 
government agency.
SEC. 4. EXCLUSION OF DEBTS RELATING TO COLLEGE FINANCIAL ASSISTANCE 
SERVICES FRAUD FROM PERMISSIBLE EXEMPTIONS OF PROPERTY FROM ESTATES IN 
BANKRUPTCY.
    Section 522(c) of title 11, United States Code, is amended--
        (1) by striking ``or'' at the end of paragraph (2);
        (2) by striking the period at the end of paragraph (3) and 
    inserting ``; or''; and
        (3) by adding at the end the following:
        ``(4) a debt in connection with fraud in the obtaining or 
    providing of any scholarship, grant, loan, tuition, discount, 
    award, or other financial assistance for purposes of financing an 
    education at an institution of higher education (as that term is 
    defined in section 101 of the Higher Education Act of 1965 (20 
    U.S.C. 1001)).''.
SEC. 5. SCHOLARSHIP FRAUD ASSESSMENT AND AWARENESS ACTIVITIES.
    (a) Annual Report on Scholarship Fraud.--
        (1) Requirement.--The Attorney General and the Secretary of 
    Education, in conjunction with the Federal Trade Commission, shall 
    jointly submit to Congress each year a report on fraud in the 
    offering of financial assistance for purposes of financing an 
    education at an institution of higher education. Each report shall 
    contain an assessment of the nature and quantity of incidents of 
    such fraud during the one-year period ending on the date of such 
    report.
        (2) Initial report.--The first report under paragraph (1) shall 
    be submitted not later than 18 months after the date of the 
    enactment of this Act.
    (b) National Awareness Activities.--The Secretary of Education 
shall, in conjunction with the Federal Trade Commission, maintain a 
scholarship fraud awareness site on the Internet web site of the 
Department of Education. The scholarship fraud awareness site may 
include the following:
        (1) Appropriate materials from the Project Scholarscam 
    awareness campaign of the Commission, including examples of common 
    fraudulent schemes.
        (2) A list of companies and individuals who have been convicted 
    of scholarship fraud in Federal or State court.
        (3) An Internet-based message board to provide a forum for 
    public complaints and experiences with scholarship fraud.
        (4) An electronic comment form for individuals who have 
    experienced scholarship fraud or have questions about scholarship 
    fraud, with appropriate mechanisms for the transfer of comments 
    received through such forms to the Department and the Commission.
        (5) Internet links to other sources of information on 
    scholarship fraud, including Internet web sites of appropriate 
    nongovernmental organizations, colleges and universities, and 
    government agencies.
        (6) An Internet link to the Better Business Bureau in order to 
    assist individuals in assessing the business practices of other 
    persons and entities.
        (7) Information on means of communicating with the Federal 
    Student Aid Information Center, including telephone and Internet 
    contact information.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.