Pell Grant Scammers Ripping off Michigan Colleges for Millions
"Thousands of Michigan residents have collected Pell Grants without attending classes in the past year, costing Michigan's colleges millions of dollars that have to be paid back to the federal government," The Detroit Free Press reports. "At Henry Ford Community College, $4.1 million -- about 10% of the money the college received in Pell Grants -- needs to be paid back to the U.S. Department of Education this year, a move that will likely contribute to a tuition increase at the Dearborn school. The problem isn't limited to Michigan, and it isn't new, but experts say it's getting worse. No one knows exactly how much these Pell scammers are costing taxpayers because central record-keeping is spotty at best and often out of date. … The fraud is particularly pronounced at community colleges because of their lower tuition rates. A student can sign up for a full load of classes for as little as $700 per semester at some Michigan community colleges and then pocket the leftovers from the $2,750 maximum grant. "You'll only hear about this at low-cost schools," said Karen McCarthy, a policy analyst for the National Association of Student Financial Aid Administrators. "If the costs are high, the students won't get any of their money back."
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