How are you fraud proofing?

1. How are you fraud proofing? Michelle Greco, Delgado Community College Vickie Temple, Bossier Parish Community College

2. Cases OFFICE OF INSPECTOR GENERAL The Office of Inspector General (OIG) is an independent component of the Department. They examine allegations of fraud, waste, and abuse, and pursue those who seek to enrich themselves by abusing Department programs at the expense of our nation’s taxpayers

3. Cases SCHOOL RESPONSIBILITY Schools and their third party servicers must refer to the OIG “any credible information” indicating that a student, school employee, third party servicer, or other agent of the school “may have engaged” in fraud, criminal or other illegal conduct, misrepresentation, conversion, or breach of fiduciary duty involving Title IV.

4. Cases WHY ARE YOU IMPORTANT TO OIG? You play a critical role in helping OIG achieve our mission. You serve as OIG’s “eyes and ears” and help us detect and prevent fraud.

5. Cases WHY ARE YOU A TARGET FOR FRAUD? You are a financial institution that handles millions of dollars every year. Your “customers” do not typically consider the fraud threat. Your infrastructure may not be configured for fraud detection, prevention, and deterrence.

6. Cases TYPES OF POTENTIAL FRAUDULENT ACTIVITIES FAFSA Fraud Falsification of Documents Identity Theft Distance Education Schemes Fraud/theft by School Employee Ghost Students Financial Statement Falsification Obstruction of a Federal Audit or Program Review 90/10 Rule Manipulation

7. Cases TYPES OF POTENTIAL CYBER CRIME ACTIVITY Compromise of system privileges Compromise of information protected by law (FERPA, GLBA, etc..) Unauthorized or exceeding authorized access of IT systems or protected data Indicators of possible criminal activity: Insiders  Requesting access to systems to which they do not require access Using removable media in systems where data should not be removed Accessing systems outside normal work hours Bragging about having access to sensitive data Outsiders  Excessive complaints about identity theft Unexplained mail delivery rules in mailboxes

8. Cases HACKER Allegation: A private investigator fraudulently used President Donald J. Trump’s personal identifying information, including his social security number, in an attempt to illegally obtain his federal tax information from the Internal Revenue Service. Investigation: Jointly investigated by ED OIG, Treasury IG for Tax Administration, and FBI. Investigation revealed that the individual created a FAFSA account for the President and attempted to obtain the President’s tax information through the Data Retrieval Tool. Outcome: the individual pled guilty to false representation of a Social Security Number. Sentenced to 18 months in jail and $14,000 restitution.

9. Cases DISTANCE EDUCATION FRAUD SCHEME Allegation: Between May 2010 and September 2016, individuals operated a student aid fraud ring in the Greenwood, Mississippi area, enrolled hundreds of individuals in various postsecondary distance education programs across the country and submitted FAFSAs to the U.S. Department of Education to obtain. The estimated loss to ED was over $2.5 million in Title IV funds. Investigation: With the assistance of a relative, the individual effectively operated a massive student aid fraud ring in the Greenwood, Mississippi area by enrolling hundreds of individuals into various post-secondary distance education programs across the country and submitted FAFSAs to the U.S. Department of education to obtain Title IV funds in their names. Outcome: On May 18, 2018, the assisting relative was sentenced to 3 years of probation for Misprision of a Felony.The individual was sentenced to 18 (1 year and 6 months) months imprisonment, 3 years of probation, and ordered to pay $249,000 in restitution to the United States Department of Education for Conspiracy to commit wire fraud.

10. Cases FRAUD BY FORMER PURCHASING DIRECTOR Allegation: Pontifical Catholic University of Puerto Rico (PCUPR) referred allegations that an employee misused federal funds after reviewing a forensic accounting report by an external CPA firm. Investigation: The former director used the school’s credit card for unauthorized personal expenses, including household utility bills, school tuition, and vacations. To conceal her crime, she altered and created fictitious credit card statements where she hid her personal charges by increasing the amounts of other legitimate charges to the card, or by deleting the charges altogether before submitting the statements to the school’s finance department for payment. Outcome: The former director was sentenced to serve 1 year in prison and 3 years supervised release and was ordered to pay more than $155,400 in restitution

11. Cases WHY REPORT FRAUD TO OIG? Meet statutory and regulatory requirements Comply with ethical responsibility Deter others from committing fraud and abuse Protect the integrity of the Title IV Programs Avoid being part of a fraud scheme Prevent administrative action Avoid civil penalties Prevent criminal prosecution

12. Cases REPORT FRAUD You can reach the Hotline on the web at: OIGhotline.ed.gov For questions, call 1-800-MIS-USED

13. Cases

19. Thank you Vicki Temple vtemple@bpcc.edu Michelle Greco mgreco@dcc.edu