University System of Georgia audit finds serious misconduct in Albany State University Financial Aid Office

ALBANY — The Albany Herald has obtained a copy of a University System of Georgia internal audit of Albany State University’s Financial Aid Office in which a review of the financial aid histories of five students who also were employees of the university shows that one former employee of the financial aid department received $270,000 in federal student financial aid since 1985.

The ASU Office of Communications has confirmed that four financial aid office employees have been terminated, but would not release the names the former employees.

Among the recommended actions from the University System were corrective personnel action and reorganization within the ASU Financial Aid Office and referring the report to authorities for review for any possible criminal violations.

“Earlier, we communicated with the campus about a report of irregularities in our financial aid office,” ASU Interim President Art Dunning said. “We engaged the proper authorities and launched an immediate, complete and thorough investigation. That investigation has now been completed. The investigation revealed serious misconduct on the part of several of our employees. We have taken appropriate disciplinary action with the involved employees.

“I want to make very clear that this type of misconduct has no place at Albany State University. We are moving forward to ensure that the financial aid office has the human and technical resources, policies and protocols in place to better serve the needs of our students. Going forward, we can assure you that proper oversight, integrity of the process and quality customer service will be the priorities of the financial aid office.”

According to the heavily redacted audit report, the irregularities came to light in August after Stephanie Lawrence, the newly appointed director of the Financial Aid Office, contacted the ASU Office of Internal Audits regarding irregularities she found in financial aid awards to an employee of the Financial Aid Office.

Lawrence discovered the irregularities while reviewing recent financial aid appeal petitions from students who had not met Satisfactory Academic Progress (SAP). SAP is the standard that students must meet in order to continue receiving financial aid.

Lawrence noticed an appeal from a Financial Aid Office employee was granted without sufficient justification. She looked into the matter further and saw that the employee also had exceeded the number of appeals allowed. Additionally, there was a pattern of improper appeals granted to the employee. Of the 10 appeals, auditors said they found records on eight. Former Director of Financial Aid Thomas Harris, the report said, was responsible for “proper review of all appeal petitions.”

In Student 1’s case, Harris handled one of the appeals, the report states. The seven other verifiable appeals were handled by faculty member Kwame Dankwa, who approved five and who had not been adequately trained on appeals, and staff accountant Sharon Smith, who approved two and had received no training on appeals, the report states.

Much of the report focused on that student, an employee of the Financial Aid Office whose identity was redacted and who was referred to as “Student 1” and “S1” in the report. The audit found that “since 1985, [Student 1] has been awarded more than $270,000 in federal student financial aid. Almost half of this amount represents Graduate PLUS loans that are not need-based. Of the $270,000 that [Student 1] received, $242,844 was disbursed to [Student 1] as a Title IV Credit Balance — financial aid award less payment for tuition and fees. This balance represents how much money [Student 1] received in the form of a debit card to use for ‘education-related expenses.’

“It should be noted that as a result of [Student 1’s] participation in the USG’s Tuition Assistance Program, [S1’s] tuition and most fees were waived for seven semesters. According to [Student 1] , [S1’s] repayment to date for all of the financial aid awarded is $600.”

Student 1, according to the report, filed eight appeal petitions over the course of receiving financial aid. Students are entitled to five appeals over the student’s academic career. The report also stated Student 1 had a history of withdrawing from class.

Since the fall of 2010, Student 1 was suspended from receiving further financial aid a total of 10 times for failing to meet Satisfactory Academic Progress (SAP). The over-award to Student 1, based upon having exceeded the limit of five appeals, is more than $77,000, the report said The amount of the over-award based upon the insufficiency of all of Student 1’s appeal petitions is more than $160,000, the report said.

According to the report, Student 1 was not the only employee in the Financial Aid Office who was suspended from financial aid and who subsequently filed appeals. An employee identified as Student 4 filed appeals in the spring and fall of 2011, and both appeals were granted, the report said. Only one of the appeals could be located. Student 3 also appealed a suspension from further financial aid in the fall of 2012 and again in the spring of 2013. Both appeals were granted, the report said, and neither petition for appeal could be located in office records.

Since the fall of 2010, Student 3 enrolled in 10 classes and withdrew from all of them except one that was redacted from the report. During that time, the report said, Student 3 was awarded student loans in the amount of $63,309. Of the financial aid award Student 3 received, $59,212 of it was disbursed to Student 3 as a Title IV Credit Balance — financial aid award less payment for tuition and fees, the report said. The balance represents how much money Student 3 received in the form of a debit card to use for “education-related expenses.”

For three of the semesters for which Student 3 received financial aid, the student did not have any tuition payments as they were covered by the USG’s Tuition Assistance Program, the report said, noting that Student 3’s last class was in the spring of 2013. Since that time, the report states, Student 3 has not made any payments on outstanding student loans.

Harris also was interviewed during the audit, in which he was questioned regarding the appeals which were approved for Student 1. The report states that Harris admitted being too lenient in reviewing Student 1’s appeals. He indicated that he should have been more on the “front end” of the appeal process and taken the leadership role expected of his position, the report says. Harris stated he knew the limit for appeals was five, but said he thought the limit of five was an Albany State University policy and not a requirement of the Department of Education, the report said.

The report also cited the university for failure to implement recommendations from a fall 2014 audit, failure to return grant funds, missing financial aid certifications, improper application of cost of attendance, and improper disbursement of loan funds.

The University System of Georgia suggested four recommended courses of action:

— Take corrective personnel action and reorganization of positions within the Financial Aid Office;

— Refer the report to proper authorities for review of possible criminal violations;

— Evaluation of staff performance and employee ethics training;

— Increased oversight of the financial aid office.

When contacted today for a comment on the audit, USG Vice Chancellor for Communications Charles Sutlive said, “The report speaks for itself.”