Student Financial Aid Programs: Pell Grant Program Abuse (Testimony,
10/27/93, GAO/T-OSI-94-8).

The Department of Education must take the lead in marshalling its own
resources and enlisting the support of the states in protecting federal
student financial aid programs from fraud and abuse.  GAO discovered
that many Orthodox Jewish schools, or yeshivas, in New York City were
involved in misconduct relating to the Pell Grant Program, which is
supposed to help finance the postsecondary education of low-income
undergraduates.  The yeshivas had been submitting documentation to the
Department of Education for (1) "ghost" students--students who had never
applied for Pell Grants or persons who had never enrolled in or attended
the yeshivas that were using their names; (2) ineligible high school
students; (3) persons whose biographical information had been sold to
yeshivas by "brokers" for use in obtaining Pell Grants; and (4)
misrepresentation of their academic programs and other eligibility
criteria.  Between 1983 and 1993, the 23 institutions GAO investigated
obtained more than $300 million in Pell Grant funds; 60 percent of this
money--$197 million--was obtained within the last three years.  During
this period, the Department of Education failed to adequately screen or
review schools for participation eligibility.

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

 REPORTNUM:  T-OSI-94-8
     TITLE:  Student Financial Aid Programs: Pell Grant Program Abuse
      DATE:  10/27/93
   SUBJECT:  Fraud
             Educational grants
             Private schools
             Higher education
             Program abuses
             Documentation
             Student aid programs
             Ineligible grantees
             Immigrants
             Institution accreditation
IDENTIFIER:  Pell Grant
             New York (NY)
             Guaranteed Student Loan Program
             National School Lunch Program
             
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