Financial Aid Defrauders Target Community Colleges - KXXV-TV News Channel 25 - Central Texas News and Weather for Waco, Temple, Killeen |

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Financial Aid Defrauders Target Community Colleges

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Millions of students nationwide depend on financial aid to pay for college but some people are scamming the system. The American Association of Community Colleges says defrauder target community colleges because they're easy to get into and cost of tuition is low.

 Financial aid is given to help people pay for college tuition and related expenses. Those who are abusing the system will enroll in classes just for the purposes of collecting a check and then drop out. Some even move from college to college once they've been suspended for financial aid fraud. Still others participate in organized fraud rings that cipher thousands of dollars from the system.

 Central Texas College spokesman Bruce Vasbinder says they've notice the problem at their campus.

 "We've noticed that there [has] been some fraud involved. That's where they're getting their cash flow. So once they do that, they disappear and we never hear from them again. Or they never take the classes as they're intended," said Vasbinder.  

 According to financialaid.org there are currently more than 7,000 students getting financial aid, through grants or loans at CTC alone. Many of whom are receiving the Federal Pell Grant, a need-based grant of $5,500. At CTC tuition is currently $160 per unit. So a $3,800 school bill still leaves more than $1,600 for students to spend.

 CTC wasn't able to provide specific numbers for the amount of fraud cases they have but says it's a problem not just for their school.

 "According to our financial aid department it seems like every community college along the I-35 corridor is getting hit at some point or to some degree," said Vasbinder.

 In 2009, Texas was the second highest state with the most people applying for FASFA behind California, according financialaid.org. According to the same site, there are more than 3,100 people receiving financial aid at Temple College and more than 4,500 at McLennan Community College.

 An MCC spokeswoman said that financial aid fraud was a problem at their school just last year but new federal guidelines have made it harder for students to scam the system.

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