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The Guardianship Scandal

THE NEW COLLEGE ADMISSIONS SCANDAL

On Monday, July 29, 2019, ProPublica and The Wall Street Journal published stories on independent investigations revealing a new college admissions scandal. This scandal does not involve cheating on SAT/ACT scores or posing as recruited athletes in order to boost a child’s application, however. In College Admissions Scandal Part II, the issue is not one of being accepted to elite schools but of affording them. In the newest chapter of what is wrong with this country’s system of higher education—and one could argue society at large—the investigations revealed that 30-40 families from an affluent Chicago suburb have been seeking guardianship for their college-bound teens in order to make them eligible for financial aid.

The scheme goes like this: high-achieving kids of affluent parents get accepted to elite schools that their parents cannot quite afford—the parents make too much money to qualify for financial aid, but are not wealthy enough to pay the full price of these expensive universities. Eager for their children to go to the “best schools,” these parents find a family friend or relative to become guardian of their child, going to court to legally request the change in status. The child then claims their status as “independent” on financial aid forms, and becomes eligible for funding.

That funding includes both institutional funding, which varies depending on each school, and federal and state funding. Federal funding is based on information contained in the Free Application for Student Aid, or FAFSA, and is often disbursed through Pell Grants and state grants. In Illinois last year, up to 82,000 students who were eligible for the state grant of up to $5,000 did not receive it because the money ran out. The grants are need-based, and disbursed on a first-come, first-served basis.

IS IT REALLY LEGAL?

People have been quick to point out that this scandal, unlike the one at the heart of Varsity Blues, involves a scheme that is legal, albeit untoward and unethical. But is it really legal?

When applying for financial aid, students—even those claiming the status of “independent”—must report all money and support given to them by their parents. Failure to do so constitutes fraud, and is subject to a fine of up to $20,000 and/or prison of up to 5 years. Arguably, the students involved in this scheme are not reporting their parents’ contributions to their college expenses on the FAFSA, and by failing to do so they are committing fraud.

In addition, many of the petitions for guardianship uncovered in the investigation by ProPublica state the reason for seeking the guardianship as follows: “guardian can provide financial and educational support and opportunities to the minor that the parents could not otherwise provide.” That is not really true, since the guardian is not providing anything other than a fictitious status. Stating this in a court document that is signed could constitute perjury.

A probate or juvenile court judge has discretion when approving requests for guardianship, and the applicable standard of “best interests of the child” is admittedly vague and broad. However, facilitating financial planning for college is not one of the legally recognized factors for granting a guardianship. Changing a child’s legal status in order to qualify for a needs-based program is fraud, and a complete misuse of guardianship laws. Guardians are appointed in order to ensure that a minor (or an incompetent adult) is cared for and has his/her basic needs provided for when a parent is unable to do so, e.g. due to illness, addiction, incarceration, mental illness, death, etc. Guardianships are temporary arrangements (as opposed to adoptions) for the care, custody and control of a child, and make the guardian responsible for providing food, shelter, clothing, education, and all medical and dental needs of the child.

None of the above remotely applies when a guardian is appointed so that a soon-to-be 18 year old can claim to be “independent” for purposes of obtaining financial aid.

WHAT THE SCANDAL SAYS ABOUT SOCIETY

Although all the investigations conducted by ProPublica and The Wall Street Journal focused on counties around Chicago, there is no reason to think that the scheme uncovered is limited to that area. Consequently, the Department of Education is looking into how widespread the “guardianship scandal” is, and Universities are reviewing financial aid applications in which guardianships are involved.

There is no question that college has become outrageously expensive. College costs at nonprofit, 4 year private colleges have doubled in the last 20 years while income has stayed relatively the same. Thus, families—even upper-middle class families—are feeling squeezed and unable to afford elite schools. Many people feel that their children deserve to go to these schools if their children get accepted; why should income define potential?

But what does it say about our society when we pervert laws—and break them—in order to provide opportunities? That is not “leveling the playing field.” That is creating a whole new ball game. One in which we are all the losers.

CONTACT YOUR ATTORNEY

If you or someone you know has been injured, contact Dave Thomas at The Thomas Law Firm for a free consultation regarding your legal rights.

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