Student Financial Aid Programs: Pell Grant Program Abuse

GAO discussed the Department of Education's student financial assistance programs, focusing on possible fraud and abuse in the Pell Grant program within certain not-for-profit parochial schools. GAO noted that: (1) program abuses have included false grant applications, schools misrepresenting their academic capabilities and program eligibility, grants to fictitious students, and grants to ineligible high school students; (2) the schools have used false documentation and admission applications to support their ghost students and mail drops to receive Pell Grant applications; (3) brokers who recruit student financial aid applicants are involved in defrauding the Pell Grant program; (4) Education has failed to screen or review schools eligible for program participation; and (5) Education has procedures to ensure schools' program eligibility and strengthen its relationships with states and accrediting organizations.