A Conversation on Fraud Prevention, ID Theft,and Information Security:

1. Session 38 A Conversation on Fraud Prevention, ID Theft,and Information Security: ED, The OIG, and You

2. ED and the OIG… Virginia Hagins Training Officer ED Training and Information Services Natalie Forbort Special Agent-in-Charge ED Office of Inspector General

3. You….

4. Topics Covered • Overview • Security • ED OIG • Fraud • Case Studies • Best Practices • Recognize • Protect • What to do • Process

5. Quiz Time Rob Emily Mark

6. You get a phone call…”Hello, this is Mr. Wesley from the Department of Education, Student Financial Assistance. We’ve noticed that individuals at your institution seem to be using NSLDS at odd hours and viewing student data for students not at your school. I need to confirm who has access. I will need you to fax me a copy of the names, addresses and SSNs of those in your office who should have access”. • You: • Ask for his fax number • Offer to give the information to him over the phone • Ask him to fax you identifying information on himself so you can verify he works for ED • Tell him…”I don’t think so” and contact ED

7. Time to purge those old paper files. Your storage area needs more space and you have kept the files the required amount of time. How do you get rid of them? • You: • Shred them and put them in a dumpster • Grab the boxes they are in, seal them tightly and call for a garbage pickup • Keep them. You never know…those students might come back… • None of the above

8. True or False? • Keep students’ pin numbers in a locked cabinet. T or F • When you backup your data, you should check your backup every 60-90 days. T or F • You have 30 days to remove access to student data (either federal or institutional) for a staff member who has either changed jobs or been terminated. T or F

9. What Metropolitan Area Ranks Highest for Identity-Theft Related Complaints? (2003) 9 • New York City, NY • Orlando, FL • Los Angeles, CA • Denver, CO • Phoenix, AZ • Chicago, IL • Las Vegas, NV (Miami – 4; Tampa 19) 2 13 1 14

10. You suspect a student is not who they say they are based on their ISIR data and current ID. You… • Investigate the situation before calling anyone • Ask your supervisor if you should call someone • Let it go…it’s not like it’s YOUR money… • Suggest to the student that they go to another institution • None of the above

11. U.S. Department of EducationOffice of Inspector General

13. Matters of Interest to OIG Lying, cheating, and stealing Fraud, Waste and Abuse • ID Theft/Beneficiary Fraud • Institutional Fraud • Financial Aid Consultant Fraud • Employee Corruption An intentional distortion of the truth in an attempt to obtain something of value. Does not have to result in monetary loss.

14. School Responsibility • Report fraud, waste, or abuse to the U.S. Department of Education, Office of Inspector General. • 34 CFR 668.16. • “Examples of this type of information are– • (i) False claims of independent student status;(ii) False claims of citizenship;(iii) Use of false identities;(iv) Forgery of signatures or certifications; and(v) False statements of income; and • Any credible information indicating that any employee, third-party servicer, or other agent of the institution that acts in a capacity that involves the administration of the Title IV, HEA programs, or the receipt of funds under those programs, may have engaged in fraud…”

15. Shakespeare, Othello, act iii. Sc. 3. “But he that filches from me my good name Robs me of that which not enriches him And makes me poor indeed.”

16. Identity Theft – What is it? When someone, without lawful authority, knowingly transfers or uses a “means of identification” of another person with the intent to commit, or aid or abet, any unlawful activity that violates Federal law, or that constitutes a felony under any State or local law. • Identity Theft and Assumption Deterrence Act of 1998 • 18 USC § 1028a (7)

17. Typical Modus Operandi of Identity Theft Perpetrators Perp Obtains Supporting ID Documents Obtains pertinent victim information Rents Mailbox/drop Contacts $ source Diverts Mail CHA CHING!

18. Tools Used to Commit FSA Fraud • Computer • On-Line Application Process for FSA funds • On-Line Enrollment • Identity of another person • Fake Identification Documents

19. Tools Used to Commit FSA Fraud • Selection of Community Colleges due to low tuition cost • Bank accounts set up in name of identity to receive FSA funds • Understanding of vulnerabilities of FSA programs

20. Types of Fraud Investigated by ED/OIG • Check fraud • Dependency • Obtaining false documentation to change dependency status or avoid reporting income • Married student who claims to be separated or parents who claim to be separated • Falsifying DHS/INS documentation • Falsifying income information

21. Types of Fraud Investigated by ED/OIG • ID theft • By someone you know • roommate, family member • By someone who buys your stolen or lost documents and assumes your identity • By a facilitator that uses many IDs(5-100) to receive financial aid

22. Sources of referrals • Financial Aid Professionals at schools • Calls from citizens, students • Case Management (SEC/SPT) • Other law enforcement agencies • Proactive Projects

23. Case Studies

24. Best Practices:Tips on Identifying and Protecting For Your Institution, Your Students, And You

25. Identify • Match flags • Documentation verifying identity • Dependency claims • Income and asset information • Verification tracking flag • Question and request additional documentation

26. Don’t carry your SSN card with you Shred sensitive information Only carry what you use Photo copy all cards in your wallet Select hard to guess pins and passwords Don’t leave mail sitting in an unprotected box Don’t give out private information over the phone Order your credit reports Use caution when providing ANY sensitive information Avoiding Identity Theft

27. Protecting Others From Identity Theft • Properly handle documents • Shred sensitive information • Use key identifiers instead of the SSN • Password protect sensitive information • Audit access • Review access privileges • Verify who you are talking to • Ensure staff receive necessary training

28. Scholarship Scams • Persons claiming to represent the U.S. Dept. of ED calling students and offering them grants/scholarships • Paying upfront for assistance • www.studentaid.ed.gov/stung

29. Tips for FAAs… • Obtain tax returns directly from IRS • Do 100% verification • Verification tracking flag • “Proof of…” statements • Divorce/separation documentation • Compare 2 or more sets of tax returns • Compare rent/mortgage payments with monthly income

30. Tips for FAAs… • Use your experience and common sense • Look for things that jump out at you… • An unusual number of students with the same address • FWS students turning in timecards that seem to exceed their ‘free time’ • Documentation from questionable sources or many from the same source

31. What Do You Do If…. • You Suspect Financial Aid Fraud… • Call the professionals!! Anyone suspecting fraud, waste, or abuse involving Department of Education funds or programs should call or write the Inspector General’s Hotline. • 1.800.MIS.USED • www.ed.gov/misused • Office of Inspector General • U.S. Department of Education • 400 Maryland Avenue, SW • Washington, DC 20202-1510

32. Regional OIG Offices

33. What to Do… FIRST, contact the fraud departments of each of the three major credit bureaus: • Equifax: www.equifax.Com • 1-800-525-6285 • Experian: www.experian.Com • 1-888-397-3742 • TransUnion: www.transunion.Com • 1-800-680-7289

34. And… SECOND, close the accounts that you know or believe have been tampered with or opened fraudulently. THIRD, file a police report with your local police or the police in the community where the theft took place.

35. Other Resources Social Security Administration, Fraud Hotline 1-800-269-0271 Federal Trade Commission 1-877-IDTHEFT (438-4338) Opt-out line 1-888-567-8688 www.fightidentitytheft.com http://driverslicenseguide.com/

36. So What Happens Now… • Initial complaint • Investigate validity of referral • Interview complainant • Request records • Financial aid • ID documentation (DMV, INS, criminal history, etc.) • Interview leads

37. So What Happens Now… • Determination of fraud or administrative issue • Administrative issues referred to SEC/SPT • Formerly known as Case Management • Open investigation • Search warrants • Subpoenas • Interviews

38. So What Happens Now… • Indictment(s) • Arrest(s) • Possibility of plea bargaining • Initial appearance/bail hearing • Trial • Sentencing

39. Additional Information • Handouts: • Contact list for publications • Alien Registration Card Documentation • Social Security Card Documentation • Nonimmigrant Visa Documentation • Fantasy & Camouflage Passports • Student Information

40. Technical Assistance We appreciate your feedback and comments. We can be reached at: • Natalie Forbort • 562-980-4132 • natalie.forbort@ed.gov • Virginia Hagins • 415-556-4205 • virginia.w.hagins@ed.gov

41. Shakespeare, Othello, Act I, Scene III. "The robbed that smiles steals something from the thief".