Student Eligibility Review Update

January 4, 2021

Important Update to Student Eligibility Review Service Performed by FAS

Dear School Owner, President and/or Financial Aid Administrator,

Please note the immediate changes to the Student Eligibility Review Process FAS performs for your institution. These changes must be made to adhere to the requirement the Department of Education has set for ALL Third-Party Servicers who assist institutions with Title IV funding.

The below specific language from The Department of Education that was part of Financial Aid Services, Inc., Close out to a Program Review has initiated immediate changes in how FAS must collect documents for student eligibility review and disburse to students going forward.

“Although Financial Aid Services, Inc. (FAS), considers this program review to be closed, the Department reminds FAS., that a third-party servicer is subject to the highest standard of care and diligence in performing its obligations and accounting to the Department of Education for any Title IV funds administered on behalf of the institutions with which FAS contracts. Third Party Servicers may establish a process under which the institution confirms eligibility, and the servicer verifies periodically that the confirmations are accurate. However, if the Department or an auditor identifies significant student eligibility issues at an institution, the Department would consider the process established for confirmation inadequate and both the institution and the server may be held jointly and severely liable for any disbursements made. If an institution refuses to provide documents necessary to confirm student eligibility (timely) or to account for the Title IV funds disbursed (reconciliation), third party servicers including FAS, are required to notify the Department of the institutions refusal to comply with Title IV regulations. Third party servicers (FAS) are not able to adhere to a fiduciary standard of conduct and comply with the Title IV HEA standards of administrative capability if the institutions with which it contracts, refuse to provide the documentation necessary for the servicer to perform the functions or services it was contracted to perform.”

During FAS’ diligent attempts to review student eligibility for disbursed students at its client institutions, FAS has experienced challenges in completing its review timely, or even at all, due to its institutions’ inability to return requested documents for various reasons. FAS has met with the Department of Education and has been issued the above statement. As a responsible Third-Party Servicer looking out for the best interests of our client schools, in order to help them maintain funding, we have revamped our system of review to more closely follow the requirements as stated.

Therefore, starting immediately, FAS will be requesting a 10% sample of student files to review eligibility for Title IV in the current award year either before the enrolled student’s first disbursement and/or before second disbursement of any Title IV program funds. FAS will not release any future disbursements of Title IV funds for the selected students for review until FAS is able to collect and validate all required documents that determine student’s Title IV eligibility.

Please give any request for student eligibility review documents your immediate attention to avoid delays in disbursements.

It is against the law and a non-compliant practice to release any type of Title IV disbursement to an “ineligible” student.

FAS has put tremendous resources in place to sample student populations to review for eligibility and will continue to evolve our process for timeliness and efficiency, so we do not hold up disbursements. We ask for your cooperation in providing needed documents and clarification as requested as soon as possible. Please prioritize all requests. FAS will adhere strictly to this process and its deadlines.

Institutions should review its policies and implement appropriate training to accomplish 100 % compliance with student eligibility by reviewing all student/FAA completed documents for missing or conflicting information.

FAS offers training and consulting and guidance on demand for any client institution in need.
Avoid your students being delayed for disbursement due to ineligibility.

Please reach out to us with any questions or concerns.
Thank you for your understanding.


Sandi O’Connell
Vice President of Operations
Financial Aid Services, Inc.

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