Higher Education: Verification Helps Prevent Student Aid Payments to
Ineligible Noncitizens (Letter Report, 08/06/97, GAO/HEHS-97-153).

Pursuant to a legislative requirement, GAO reviewed the extent to which
illegal aliens are receiving postsecondary federal student financial
assistance, focusing on: (1) the processes that ensure that ineligible
noncitizens do not receive federal financial aid under title IV of the
Higher Education Act of 1965; (2) how many potentially ineligible
noncitizen applicants were identified through these processes; and (3)
the indications, if any, of the degree to which ineligible noncitizens
are receiving student financial aid despite these processes.

GAO noted that: (1) the processes for preventing ineligible noncitizens
from obtaining federal student financial aid focus on identifying
applicants whose eligibility is questionable and referring their names
to financial aid administrators at postsecondary institutions for
follow-up; (2) no federal student financial aid can be released until
the applicant provides proof of eligibility to the administrator; (3)
the Department of Education's processes for verifying the citizenship
status of all financial aid applicants appear to be working reasonably
well, as departmental monitoring has found few implementation problems;
(4) the Immigration and Naturalization Service's (INS) and Social
Security Administration's (SSA) screening techniques identified over
500,000 potentially ineligible noncitizens in award year 1996-1997, but
it is possible that many of them ultimately provided proof of their
eligibility; (5) according to the Department, of the 9.6 million
financial aid applicants in award year 1996-1997, almost 460,000, about
5 percent, initially failed SSA screening--SSA could not confirm that an
applicant was a U.S. citizen--and another approximately 108,000 were
flagged for followup because INS could not confirm that they were
ineligible noncitizens; (6) the Department does not know how many of the
flagged applicants were subsequently found ineligible, because financial
aid administrators are required to neither inform the Department of the
results of their followup nor centrally maintain such information
themselves; (7) to shed some light on the final outcome concerning an
applicant's eligibility, GAO contacted financial aid administrators at
four colleges with high numbers of noncitizens in attendance; (8) they
estimated that virtually all the applicants flagged through SSA and INS
screening were ultimately able to demonstrate their eligibility for
student aid; (9) no one knows whether or how many ineligible noncitizens
are managing to qualify for student financial aid; (10) the Department's
Office of Inspector General (OIG) has not opened any investigations of
applicants who falsified their citizenship status and received aid since
the SSA verification process was implemented in 1996; (11) however, OIG
did, primarily in response to allegations of citizenship fraud, identify
26 cases in which ineligible noncitizens received aid between 1993 and
1995, totalling about $332,000; (12) illegal aliens constituted almost
half of these recipients; and (13) the Department referred the cases to
the Department of Justice for prosecution.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-97-153
     TITLE:  Higher Education: Verification Helps Prevent Student Aid 
             Payments to Ineligible Noncitizens
      DATE:  08/06/97
   SUBJECT:  Aid for education
             Higher education
             Student financial aid
             Illegal aliens
             Eligibility determinations
             Computer matching
             Interagency relations
             Program abuses
             Colleges/universities
IDENTIFIER:  National Direct Student Loan Program
             Federal Family Education Loan Program
             Pell Grant
             
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Cover
================================================================ COVER


Report to Congressional Committees

August 1997

HIGHER EDUCATION - VERIFICATION
HELPS PREVENT STUDENT AID PAYMENTS
TO INELIGIBLE NONCITIZENS

GAO/HEHS-97-153

Student Aid to Ineligible Noncitizens

(104877)


Abbreviations
=============================================================== ABBREV

  INS - Immigration and Naturalization Service
  OIG - Office of Inspector General
  SAR - Student Aid Report
  SSA - Social Security Administration

Letter
=============================================================== LETTER


B-277450

August 6, 1997

The Honorable James M.  Jeffords
Chairman
The Honorable Edward M.  Kennedy
Ranking Minority Member
Committee on Labor and Human Resources
United States Senate

The Honorable William F.  Goodling
Chairman
The Honorable William L.  Clay
Ranking Minority Member
Committee on Education and the Workforce
House of Representatives

The Honorable Spencer Abraham
Chairman
The Honorable Edward M.  Kennedy
Ranking Minority Member
Subcommittee on Immigration
Committee on the Judiciary
United States Senate

The Honorable Lamar Smith
Chairman
The Honorable Melvin L.  Watt
Ranking Minority Member
Subcommittee on Immigration and Claims
Committee on the Judiciary
House of Representatives

The Department of Education administers a federal student financial
aid structure that in academic year 1997-98 will provide about $47
billion in grants, loans, and other aid to 8.1 million recipients. 
Grants are provided mainly through the Federal Pell Grant Program,
under which a student may receive up to $2,700 a year, depending on
the demonstrated financial need.  Loans come from a number of
programs, the largest of which are the Federal Family Education Loan
Program (the government guarantees loans provided by private sector
lenders) and the William D.  Ford Federal Direct Loan Program (the
government makes loans directly to borrowers). 

Student eligibility criteria spelled out in title IV of the Higher
Education Act of 1965, as amended, require that only U.S.  citizens
and eligible noncitizens receive federal student financial aid. 
Students who do not fall into either of these two categories are
considered ineligible noncitizens and do not qualify for federal
student financial aid.  "Ineligible noncitizens" is a broad category
that includes illegal aliens (persons who are in the United States in
violation of U.S.  immigration laws) as well as individuals legally
in the United States.  They include entrants whose applications for
permanent residence are still pending, tourists, foreign students or
exchange visitors with temporary visas, and individuals with visas
pertaining to international organizations. 

The fiscal year 1997 Department of Defense Appropriations Act
contains several immigration and welfare reform provisions, including
a reaffirmation of the citizenship-related eligibility criteria
contained in the Higher Education Act.  A companion provision of the
law requires us to report to the appropriate committees of the
Congress on the extent to which illegal aliens are receiving
postsecondary federal student financial assistance.  This report
responds to that mandate. 

In discussing the mandate with committee staff, we agreed to expand
our analysis to all "ineligible noncitizens" because information is
not readily available on specifically illegal aliens, a subcategory
of this larger group.  In addition, we agreed to focus our work on
describing Department of Education processes intended to prevent
applicants who are ineligible noncitizens from receiving aid rather
than on conducting an independent audit of those who already received
aid in order to determine their eligibility.  We therefore focused
our work on the following questions: 

  -- What processes ensure that ineligible noncitizens do not receive
     federal student financial aid under title IV? 

  -- How many potentially ineligible noncitizen applicants were
     identified through these processes? 

  -- What are the indications, if any, of the degree to which
     ineligible noncitizens are receiving student financial aid
     despite these processes? 

To answer these questions, we obtained information from the
Department of Education, which administers federal student aid
programs; other federal agencies involved in checking students'
eligibility for aid; and four college financial aid administrators. 
Our methodology is explained in detail in the appendix. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The processes for preventing ineligible noncitizens from obtaining
federal student financial aid focus on identifying applicants whose
eligibility is questionable and referring their names to financial
aid administrators at postsecondary institutions (hereafter referred
to as colleges) for follow-up.  The Department of Education uses two
main screening techniques to determine which applicants may be
ineligible.  It checks all financial aid applicants for U.S. 
citizenship, using records of the Social Security Administration
(SSA).  In addition, for applicants who are not U.S.  citizens, the
Department checks the records of the Immigration and Naturalization
Service (INS) to determine if these applicants meet eligibility
criteria.  Names of applicants who fail either of these screenings
are sent to financial aid administrators at colleges in which the
applicant is interested in enrolling.  No federal student aid can be
released until the applicant provides proof of eligibility to the
administrator.  The Department's processes for verifying the
citizenship status of all financial aid applicants appear to be
working reasonably well, as departmental monitoring has found few
implementation problems. 

The INS and SSA screening techniques identified over 500,000
potentially ineligible noncitizens in award year 1996-97 (July 1,
1996, through June 30, 1997), but it is possible that many of them
ultimately provided proof of their eligibility.  According to the
Department, of the 9.6 million financial aid applicants in award year
1996-97, almost 460,000 (about 5 percent) initially failed SSA
screening--SSA could not confirm that an applicant was a U.S. 
citizen--and another approximately 108,000 (1 percent) were flagged
for follow-up because INS could not confirm that they were eligible
noncitizens.  The Department does not know how many of the flagged
applicants were subsequently found ineligible, because financial aid
administrators are required to neither inform the Department of the
results of their follow-up nor centrally maintain such information
themselves.  To shed some light on the final outcome concerning an
applicant's eligibility, we contacted financial aid administrators at
four colleges with high numbers of noncitizens in attendance.  They
estimated that virtually all the applicants flagged through SSA and
INS screening were ultimately able to demonstrate their eligibility
for student aid. 

No one knows whether or how many ineligible noncitizens are
nonetheless managing to qualify for student financial aid.  The
Department's Office of Inspector General (OIG) has not opened and
resolved any investigations of applicants who falsified their
citizenship status and received aid since the SSA verification
process was implemented in 1996.  However, OIG did, primarily in
response to allegations of citizenship fraud, identify 26 cases in
which ineligible noncitizens received aid between 1993 and 1995,
totaling about $332,000.  Illegal aliens constituted almost half of
these recipients.  The Department referred the cases to the
Department of Justice for prosecution. 


   BACKGROUND
------------------------------------------------------------ Letter :2

From the Department's perspective, all applicants for financial aid
fall into one of three categories of citizenship status:  U.S. 
citizen, eligible noncitizen, or ineligible noncitizen, as shown in
figure 1.  By law, only the first two categories of applicants are
eligible for title IV student financial aid.  The third category,
which includes illegal aliens and others, is ineligible for aid.\1 An
applicant who is ineligible for federal student aid may still be
eligible for state or college aid. 

   Figure 1:  Categories of
   Applicants by Citizenship
   Status

   (See figure in printed
   edition.)

An applicant uses the Free Application for Federal Student Aid form
to indicate whether he or she is a citizen, eligible noncitizen, or
ineligible noncitizen.  The application form also notifies applicants
that information provided on the application is subject to computer
matching programs with other federal agencies to verify eligibility
and to prevent fraud, waste, and abuse.  If information on the
application indicates that the applicant is a citizen or eligible
noncitizen, the Department verifies that the applicant is eligible
for aid.  If the information indicates that the applicant is an
ineligible noncitizen, the Department does not continue processing
the application and the applicant is rendered ineligible for federal
student financial aid, although he or she may be eligible for state
or college aid. 

OIG reported in 1994 that, while the Department verified the
eligibility of applicants claiming to be eligible noncitizens, it did
not verify eligibility for the vast majority of applicants who
claimed U.S.  citizenship.\2 As a result of weak internal controls
over the citizenship verification process, OIG concluded that the
Department awarded 45,000 potentially ineligible noncitizens nearly
$116 million in federal grants and loans in award year 1992-93. 
Although OIG did not verify that the financial aid recipients were
ineligible noncitizens, it recommended that the Department initiate a
data matching agreement with SSA to verify citizenship status for all
federal student aid applicants who claim U.S.  citizenship.  OIG also
recommended that the Department identify all applicants who fail the
citizenship verification process and notify them that their
application has been suspended until they can provide proof of U.S. 
citizenship to the Department.  The Department implemented both
recommendations in award year 1996-97. 


--------------------
\1 An illegal alien is a person who may have entered the United
States illegally (that is, without INS inspection, undocumented, or
by using fraudulent documentation) or legally (under a nonimmigrant
visa or other temporary conditions but subsequently violated the
terms of the visa or other terms of entry). 

\2 Department of Education, Office of Inspector General, Ineligible,
Non-U.S.  Citizens Received $70 Million in Federal Pell Grants, ACN: 
11-40000 (Washington, D.C.:  Sept.  9, 1994). 


   RESPONSIBILITY FOR IDENTIFYING
   INELIGIBLE APPLICANTS IS SHARED
   BY THE DEPARTMENT AND COLLEGES
------------------------------------------------------------ Letter :3

During a given school year, all federal student financial aid
applications (about 10 million annually) go through the Department's
automated Central Processing System.  The system's functions include
matching applicants against SSA and INS databases to make a
preliminary determination of an applicant's eligibility as a U.S. 
citizen or eligible noncitizen and producing the Student Aid Report
(SAR).  SARs are sent to the applicant as well as all colleges he or
she listed on the application.  College financial aid administrators
use SARs to determine the type and amount of federal financial aid
the student is eligible to receive, as well as aid from state,
college, and other sources.  The Department also monitors, through
its program reviews and independent audits, the procedures that
college financial aid administrators used to determine whether
applicants were citizens or eligible noncitizens. 


      THE DEPARTMENT USES TWO
      TYPES OF MATCHES TO IDENTIFY
      POTENTIALLY INELIGIBLE
      APPLICANTS
---------------------------------------------------------- Letter :3.1

To verify that an applicant is either a U.S.  citizen or eligible
noncitizen, the Department conducts an electronic match in
conjunction with SSA and INS, in which citizenship information on a
student's application is matched against SSA and INS databases. 
Applicants who pass the appropriate matches are eligible for aid. 
Those who do not pass are flagged and must provide satisfactory proof
of their citizenship status to the college financial aid
administrator before eligibility can be determined. 

All aid applicants who claim they are U.S.  citizens or eligible
noncitizens undergo the SSA match to confirm their status. 
Applicants claiming eligible noncitizenship must simultaneously
undergo the INS match for confirmation of their status, as shown in
figure 2.\3 The SSA match, implemented in 1996 in response to OIG's
recommendations, and the INS match, implemented in 1989, are
conducted each time a student applies for aid.  SSA and INS are
responsible for providing match results to the Department within 24
hours of its request for verification of an applicant's citizenship
status. 

   Figure 2:  Overview of the SSA
   and INS Matches

   (See figure in printed
   edition.)


--------------------
\3 Department officials stated that it is more efficient for the
Central Processing System to submit all applications for the SSA
match, whether an applicant claims to be a citizen or eligible
noncitizen.  Since applicants claiming to be eligible noncitizens are
subject to both the SSA and INS matches, results of the INS match
take precedence over those of the SSA match. 


         SSA CONFIRMATION OF
         CITIZENSHIP
-------------------------------------------------------- Letter :3.1.1

During the SSA match, the Department sends the student's financial
aid application to SSA, which then compares the applicant's Social
Security number, name, and date of birth with its data base.  All
three fields must match SSA's records before U.S.  citizenship can be
confirmed.  If SSA confirms that the applicant's information matches
that of a U.S.  citizen, the applicant is eligible to receive federal
student financial aid.  If SSA cannot determine whether the applicant
is a U.S.  citizen--that is, if there is a discrepancy in the
applicant's Social Security number, name, or date of birth--the
applicant must provide the college with proof of citizenship, such as
a birth certificate, passport, or naturalization certificate.  The
financial aid administrator uses this additional information to
decide what action to take based on the applicant's citizenship
status.  If the additional information indicates that the applicant

  -- is a U.S.  citizen (for example, the applicant was born abroad
     to U.S.  citizen parents and could be a U.S.  citizen), no
     further match is performed and the applicant qualifies for
     federal student financial aid;

  -- is an eligible noncitizen, he or she undergoes the INS match,
     remaining ineligible for federal financial aid until INS
     confirms eligibility; or

  -- is an ineligible noncitizen, he or she does qualify for federal
     student financial aid. 


         INS CONFIRMATION OF
         ELIGIBLE NONCITIZENSHIP
-------------------------------------------------------- Letter :3.1.2

The INS match has two components:  primary and secondary
confirmation.  During primary confirmation, the Department sends the
noncitizen student's application to INS, which then compares the
applicant's alien registration number with its data base to confirm
that the applicant is an eligible noncitizen as claimed.\4 Applicants
failing primary confirmation must provide the college's financial aid
administrator proof of their eligibility, such as an alien
registration receipt card (commonly known as a "green card") or
passport and must generally undergo secondary confirmation. 

A college initiates the secondary confirmation process by sending an
applicant's documentary evidence (obtained during primary
confirmation), along with a completed Document Verification Request
(INS Form G-845S) to the local INS District Office to certify the
authenticity of the documents.  The college must wait up to 15
business days for INS secondary confirmation before determining the
applicant's eligibility.\5

If secondary confirmation indicates that the applicant's documents
have expired, appear to be counterfeit, or otherwise fail to support
the applicant's citizenship eligibility, colleges notify the
applicant that unless he or she corrects the discrepancy with INS,
the case will be submitted to the Department's OIG for investigation. 
Secondary confirmation is not required if the college has no
conflicting information on the applicant and if the applicant
provides the same documents that were used to pass secondary
confirmation in a prior award year, as long as the documents are
current. 


--------------------
\4 INS assigns an alien registration number to each noncitizen alien
legally residing in the United States and those illegal alien who it
identified. 

\5 If the college does not receive a determination from INS within 15
business days, the financial aid administrator may review the file to
determine whether the applicant is still eligible based on his or her
documentary evidence.  As long as the college has no conflicting
information on the applicant, the applicant may be eligible for
federal student financial aid.  The administrator must note in the
applicant's file that INS did not respond in 15 days. 


      COLLEGE FINANCIAL AID
      ADMINISTRATORS REQUIRED TO
      RESOLVE ELIGIBILITY OF
      FLAGGED APPLICANTS
---------------------------------------------------------- Letter :3.2

If the Department questions an applicant's eligibility as a result of
an SSA or INS match, the Department identifies this information on an
SAR to call it to the college financial aid administrator's attention
for follow-up.  Once financial aid administrators make the final
eligibility determination, they are required to note it in the
applicant's file and keep copies of evidence they used in making
their determination where these can be reviewed by program reviewers
and auditors.  The administrators are not required to report this
information to the Department or to maintain it centrally at the
college. 

The Department does not hold the college liable for an error in an
eligibility determination if, in making that determination, the
college had no conflicting data on that applicant and relied on

  -- the SAR indicating the applicant met the eligibility
     requirements for federal student aid,

  -- INS' determination that the applicant was an eligible
     noncitizen, or

  -- documents from the applicant proving that he or she is an
     eligible noncitizen if INS did not provide a determination
     within 15 business days. 

If the financial aid administrator determines an applicant's
eligibility without relying on one of these types of documents, the
college could be held responsible for repaying federal financial aid
funds to the Department; otherwise, the applicant is held
responsible.  For example, applicants who fraudulently filled out the
application would be held responsible. 


      DEPARTMENT MONITORING FINDS
      FEW IMPLEMENTATION PROBLEMS
---------------------------------------------------------- Letter :3.3

The Department monitors both the financial aid administrators'
determinations of applicants' eligibility and the two automated match
processes.  The Department has found few problems in its monitoring
of financial aid administrators' determinations to help ensure that
they were made in accordance with established Department procedures. 

This monitoring includes an evaluation of the college's procedures
for determining student eligibility.  For example, the reviewer or
auditor checks a sample of student financial aid files to determine
whether financial aid administrators initiated and documented
subsequent verification of student applicants who were flagged by the
INS match.  In reviewing a sample of student financial aid files
since 1989, when matching was first implemented, independent auditors
and program reviewers found that financial aid administrators made
erroneous student eligibility decisions at about 3 percent of
colleges audited or reviewed.  The Department held these colleges
liable for any federal financial aid inappropriately awarded to the
students. 

The Department's annual evaluations of computer programs used to
perform the automated SSA and INS matches indicate that they are
working as intended.  In evaluating the matches, the Department
recognized that their value is dependent on, and possibly limited by,
the accuracy of SSA and INS data bases.  To illustrate, according to
the computer matching agreement between the Department and SSA,
information in the SSA data base may be less than 50 percent current. 

The Department's evaluations attempt to ensure that the matches are
properly identifying potentially ineligible applicants.  The
Department's Central Processing System performs routine edits on all
applications to identify incomplete, invalid, or inconsistent
citizenship-related information.  The edits check to determine, for
example, if citizenship is indicated, if a numerically valid alien
registration number has been provided, or if the reported Social
Security number is found in SSA's data base.  The Department
evaluates citizenship-related edits for a sample of applications by
examining how frequently they occur and how frequently applicants
correct the information. 


   MATCH PROCESSES IDENTIFY
   APPLICANTS AS POTENTIALLY
   INELIGIBLE NONCITIZENS
------------------------------------------------------------ Letter :4

The SSA and INS matches flag potentially ineligible noncitizens, but
the Department does not--and is not required to--know how many of
these applicants were subsequently found by financial aid
administrators to be ineligible for aid.  However, financial aid
administrators we interviewed estimated that, based on their
experience in resolving flagged cases, almost no flagged applicants
were found to be ineligible noncitizens. 

Department statistics show that as of March 15, 1997, about 460,000
of the 9.6 million financial aid applications (nearly 5 percent)
received in award year 1996-97 were flagged by the SSA match.  SSA
was generally unable to confirm that these applicants were either
U.S.  citizens or eligible noncitizens because of a discrepancy in an
applicant's reported Social Security number, name, or date of birth. 
The most common discrepancy was in the applicant's name, occurring in
about 83 percent of cases, followed by date of birth (12 percent) and
Social Security number (5 percent).  Further, the Department does not
know how many of these applicants claimed to be eligible noncitizens
and therefore also underwent an INS match.  Approximately 108,000 of
the 9.6 million applicants (about 1 percent) were flagged by INS'
match because they failed primary confirmation. 

The SSA and INS matches are the first step in identifying potentially
ineligible noncitizens by flagging their applications.  The match
results do not show whether college financial aid administrators
subsequently qualified these applicants for student aid.  To provide
some indication of what administrators were finding at colleges, we
contacted four financial aid officials at colleges that we previously
identified with large numbers of eligible noncitizen Pell grant
recipients in academic year 1992-93.\6 Collectively, financial aid
administrators at these colleges estimated that virtually all
applicants identified by SSA or INS matches are able to prove their
eligibility and qualify for aid.  They also confirmed that the most
common reason for an SSA flag was a discrepancy in the applicant's
name.  Estimates provided by financial aid administrators were based
on their observations and experience in processing aid applications. 
None of the financial aid offices we contacted maintains this
information centrally. 


--------------------
\6 Colleges with the highest numbers of eligible noncitizen Pell
grant recipients are identified in Higher Education:  Selected
Information on Student Financial Aid Received by Legal Immigrants
(GAO/HEHS-96-7, Nov.  24, 1995). 


   NO COMPREHENSIVE STUDIES DONE
   ON FINANCIAL AID TO INELIGIBLE
   NONCITIZENS AND NO OIG FINDINGS
   OF AID DISBURSED SINCE 1996
------------------------------------------------------------ Letter :5

Our literature search did not identify any studies or audits that
examined whether federal student financial aid was provided to
ineligible noncitizens.  While OIG's only audit of student financial
aid to ineligible noncitizens was in award year 1992-93, it also
investigates cases brought to its attention by colleges and others
suspecting citizenship fraud. 

As a result of these investigations, all OIG cases resolved to date
involve ineligible noncitizens who received financial aid before the
SSA citizenship verification process was implemented in 1996. 
Responding mainly to allegations by colleges since award year
1992-93, OIG investigated and resolved 26 cases in which ineligible
noncitizens were inappropriately awarded approximately $322,000 in
federal student financial aid.  Illegal aliens constituted almost
half of these 26 recipients and received about $118,000 in aid.  For
the 6 other cases, it was unclear whether the person was an illegal
alien because information was not available to indicate the person's
citizenship status.  In all 26 cases, the student applied for and
received financial aid before 1996, when the SSA match became
operational.  Most of the cases occurred in California, the state
with the largest population of eligible noncitizen Pell grant
recipients, and all cases were referred to the Department of Justice
for prosecution. 


   CONCLUSIONS
------------------------------------------------------------ Letter :6

The Department of Education has implemented two automated matches of
student aid applicant citizenship information with SSA and INS to
help ensure that ineligible noncitizens do not receive federal
student financial aid.  The Department's policy prohibits awarding
financial aid unless the applicant furnishes proof of eligibility to
the college financial aid administrator. 

By verifying the citizenship status of all federal student financial
aid applicants, the SSA and INS match processes appear to be a
reasonable way of helping prevent student financial aid being awarded
to ineligible noncitizens.  In addition, the notice to student aid
applicants that the citizenship status provided on the application is
subject to computer matching may deter applicants from seeking to
fraudulently receive financial aid. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :7

The Department of Education reviewed a draft of this report and had
no formal comments, although it provided several technical
suggestions that we incorporated as appropriate. 


---------------------------------------------------------- Letter :7.1

We are sending copies of this report to the Secretary of Education,
Commissioner of INS, Commissioner of SSA, and others who are
interested.  Please call me at (202)512-7014 if you or your staff
have any questions about this report.  Major contributors included
Joseph J.  Eglin, Jr., Assistant Director; Joan A.  Denomme; Charles
M.  Novak; Meeta Sharma; and Stanley G.  Stenersen. 

Carlotta C.  Joyner
Director, Education and
 Employment Issues


SCOPE AND METHODOLOGY
==================================================== Appendix Appendix

To determine the Department of Education's policies and processes for
verifying that only citizens and eligible noncitizens receive federal
student financial aid, we contacted officials at and reviewed
pertinent documents from the Department's Office of Postsecondary
Education, SSA, and INS. 

We requested information on the number of ineligible noncitizens from
the Department.  However, the Department's information allowed us to
report only the number of applicants who initially failed SSA and INS
matches but not the number of applicants who were subsequently
disqualified for aid by college financial aid administrators.  We
therefore contacted financial aid administrators at colleges with the
largest number of eligible noncitizen Pell grant recipients for each
of the five principal types of colleges (as we reported in 1995): 
public 2-year, public 4-year, private 2-year, private 4-year, and
proprietary.\7 We previously identified these colleges in our 1995
report on student aid provided to legal immigrants.\8 Four of the
five college financial aid administrators responded and provided
estimates of the number of ineligible noncitizens based on anecdotal
information.  They said that they do not routinely collect such
statistics. 

We did not independently verify statistics computed by the Department
using information in INS and SSA data bases or verify information
provided by college financial aid officials. 

We examined summary reports of Department program reviews and audits
since 1989 that indicated that 343 colleges had been cited for
improperly determining that a student was a citizen or eligible
noncitizen.  The summary reports did not contain details on the
number of applications or students or the amount of financial aid
involved.  Although a large number of colleges were cited for
deficiencies, we did not examine individual program reviews or audit
reports because most were out-of-date in relation to the rather
recent introduction of the SSA match. 

To determine whether any studies had been done on student financial
aid provided to illegal aliens, we conducted a literature search,
contacted immigration research organizations, and spoke with
officials at higher education boards in the seven states with the
most eligible noncitizen Pell grant recipients.  We also contacted
OIG offices at the Department of Education, SSA, and the Department
of Justice.  Only the Department of Education's OIG maintained this
information.  We queried the Department's OIG data base, the
Investigative Case Tracking System, and identified 26 cases involving
citizenship fraud that had been opened after award year 1992-93 and
closed as of April 30, 1997, and in which financial aid was actually
disbursed to the students.  We reviewed each case file to obtain
additional details, including the source of the case, the nature of
the citizenship fraud, whether the individual involved was an illegal
alien, the amount of student financial aid and date it was disbursed,
and the states in which the cases occurred. 

We performed our work between January and May 1997 in accordance with
generally accepted government auditing standards. 


--------------------
\7 Higher Education:  Selected Information on Student Financial Aid
Received by Legal Immigrants (GAO/HEHS-96-7, Nov.  24, 1995). 

\8 In 1995, we reported that legal immigrants constituted about 4
million, or 10 percent, of students who received Pell grants totaling
$662 million, or about 11 percent, of the total $6.2 billion in Pell
grant aid in school year 1992-93. 


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