Pell Runners flee with Fed funds

Their footprints are found at college financial aid offices. They can form into a group or go alone, but only one thing is on their minds – stealing money.

These disguised fraudsters are called Pell Runners. They jump from college to college, staying just long enough to receive a Pell Grant refund, according to the Chronicle of Higher Education. 

To maximize their amounts, they will enroll at other colleges and siphon more money from its financial aid offices. The process continues until they max out on the grant’s 18-semester limit or are caught in the act.

“In Pell Runners, it’s very intentional. They enroll to get the funds and simply in most cases don’t show up for class or show up for one or two classes and then disappear for the rest of the semester,” Valerie Culler, Director of Financial Aid, said.

Some Pell runners form into rings called straw students. They are disguised under several bogus names, and target online college classes. They can also be found at community colleges where tuition is low. The cycle is repeated when the ring recruits others to double their money efforts. When the Pell checks roll in, they often pool together the cash and go on a self-spending spree.

“The abusers have no intention earning college credit. They simply want it for the aid” Randy Daniels said about those who cheat the Pell system. Daniels is the vice president of Student Services at MCCC.

Designed by the Department of Education to give low-income students a chance to pursue a college degree, Pell grants can cover tuition, books and living expenses. The maximum amount of aid a student can receive is $5,550 but varies based on financial need.

However, some ‘students’ have seen it as a grant to line their pockets.

“It’s shame because there’s someone out there that really needs it,” Daniels said about the fraud.

For the Pell Runner, it is an easy way to get free money. That money no longer becomes free when they are caught. When they are, the colleges are left to pay what has been taken. It is also the perpetrator’s responsibility to cover all restitutions.

Daniels and Culler are quick to point out that the majority of Pell grantees complete their education on time and use it for the right reasons. Pell abuse constitutes a small percentage. According to the Chronicle of Higher Education, only 3 percent of Pell funds land in the wrong hands.

A growing, national problem, Pell Runners has raised awareness at MCCC.

“We don’t have a huge issue. We’re doing what we can to prevent it from growing,” Daniels said.

To help combat fraud, MCCC has a screening system before aid is disbursed to a student.

“We do request that the professors report to us the students who never showed up for class. That way, we can get the financial aid cancelled before those dollars are released. The Department of Education has a process in which they screen for unusual enrollment patterns, “Valerie Culler said.

Culler said when a student is flagged for attending multiple institutions; he/she must present transcripts to confirm they have earned credit.

To help combat fraud, MCCC has a screening system before aid is disbursed to a student.

Daniels said at least 80 people are currently placed on a hold because of their previous attendance patterns and lack of truthfulness in their admissions application.

When MCCC notifies students who owe money from a previous institution, many vanish from the scene.

“Most of them know that they owed money and cannot get transcripts,” he said.

However, two out of the 80 students were able to obtain their transcripts and attend MCCC.

In the 2011-2012 academic years, Culler said the total amount of Pell Grant, and student loans disbursed to students was over 10 million dollars. That fall, however, $120, 584.08 of those funds had to be paid back to the federal government. In the winter semester of the same year, $118, 440.77 had to be returned.

The pay back may seem great, but Daniels said the lost amounts account for only 2.45 % percent of the total monies disbursed.

Not all lost monies are committed by Pell Runners. Some students may have dropped out of classes because of an extenuating circumstance, such as illness, or a death in the family.

“You have to be very cautious not to lump everybody in the same category,” Culler said.

“We’re not in a position to judge.”

Students should not be discouraged to apply for help—especially if they need it.

“It’s not our goal to stop people from pursuing higher education. We aren’t hindering anything. We simply want to stop the abuse,” he said.

Read the full article on Pell Runners in The Chronicle of Higher Education: http://chronicle.com/article/Education-Department-Chases/128821/

Source: http://www2.ed.gov/programs/fpg/index.html