My classmate lied on their FASFA

My classmate and I used to be close friends but had a falling out at the beginning of the year, we still talk when in class and help each other out with work. They are from a very wealthy family that owns two successful businesses and she has a college fund in place that would pay for four years at almost any school.

Regardless, I was helping them fill out an application to a scholarship and when they went to put their EFC they put $0. I tried to be polite and explain to them that their EFC is definitely more than $0, but they pulled up their FAFSA to confirm. I only looked at the EFC and Pell (I’m not at all comfortable looking at someone else’s tax information) and told them that there must be an error on their FAFSA.

Then they told me they know, and that if they can just put that information and get the aid it will be “free money”.

I feel wrong intruding on them, and am worried that if I talk to my guidance counselor about it I will overstep. But isn’t this really wrong? And illegal? I am meeting with guidance tomorrow but feel oddly guilty about it.

This is not your issue.

You don’t know anything about the inner workings of their finances.

Colleges are well versed in people trying to cheat. When the FAFSA numbers don’t jive with their tax returns, it will all work out.

Talk to your college counselor about YOUR college plans; leave your former close friend out of the discussion.

Stay out of it. It’s not your business.

This is going to be a good life’s lesson for you.

Down the road, you will have a work colleague (who makes the same as you- or within a thousand dollars of it) tell you that he or she qualifies for XYZ public assistance program, or their kids get ABC state aid, or they found a way to get a non-profit pay their heating bills for the winter. You will have a friend whose parents are millionaires shield their assets and put the parents in a publicly funded assisted living facility meant for the indigent. I even have a neighbor who lines up every year for a program funded by our local fire department which hands out free bike helmets (meant for kids whose parents cannot afford to buy helmets, not for people who can easily afford it but would rather get a freebie).

My advice? Pretend you don’t know. Knowing aggravates you.

The IRS often catches up with the tax cheats. The folks whose parents are pretending to be indigent can get a phone call at 9 pm one Sunday night “come get your 90 year old mother now or hand us a check for $50K in back rent” and the people who get the free bike helmet from the fire department are the butt of jokes among their neighbors.

Pretend you didn’t see. It’s not as easy to commit financial aid fraud as your friend seems to think!

Actually, the government encourages reporting of suspected FAFSA fraud and you can even do so anonymously:
https://ed.gov/about/offices/list/oig/hotline.html?src=rt

There is nothing wrong with “if you see something, say something” and let the chips fall where they may.

If there is a way to report this anonymously as suggested by @illiniowl, I would be inclined to do so. However, make very sure that you do not give anyone you know (other than your parents) any hint that you did so. This is a very serious crime, and your friend’s parents could get into serious trouble. If and when this happens, you don’t want them to think that you had anything to do with reporting them.

The alternative is to keep very quiet about this. It is highly likely that the schools will catch this based on a mismatch between the reported FAFSA information and tax returns.

What your former friend is doing is seriously illegal, and is basically stealing money from Americans who actually need financial aid to attend university. As such it is also seriously immoral.

I don’t see how OP is sure of their financial reality or how they got the zero EFC. She says she didnt look at the financial details on the Fafsa app, that she’s not comfortable looking/knowing. So how could she "know " their wealth or the true $ success of the businesses, value in a college fund?

It’s hard enough for some kids to get their own parents to reveal. Most kids don’t understand how business taxes work, how they can seem to lower AGI. Etc.

Adding: don’t see why you got involved with an ex friend’s scholarship app, in the first place. Or what expertise you think you offer that her supposedly rich family that knew how to cheat the Fafsa couldn’t jsndle.

@lookingforward

Their family owns two houses, four cars, and a boat. They go on extravagant trips out-of-state and out-of-country. There were periods of time where I lived with their family and I did work for their parents when asked. Money has never been an issue and if I am somehow misunderstanding that with all these assets and a 529 they are still eligible for a full Pell Grant, then I’m confused by the entire FA system.

@annabanabelle I think they are going to get caught anyway and in huge trouble.

Yeah I think they’ll get caught in the verification process.

They aren’t going to get rich off the Pell Grants but they would be taking $ from kids that actually need it.

Their chances of success are very low.

Some people live well beyond their means. Some people also lie. Perhaps they were able to structure the business financials in such a way to qualify for aid this year. The bottom line is that you really don’t know what their financial situation is. But if you feel strongly about it, then you should do what your conscience tells you.

I try not to worry about other peoples’ finances as they are far beyond my control - I have enough to worry about with our own.

We have family friends who take their adult children’s whole families on trips, etc. I doubt the adult kids tell anyone that they couldn’t afford some of these excursions. It is no ones’ business. You really don’t know for sure how things are owned or if there is something else going on.

If that FAFSA doesn’t match their tax return, it will be immediately evident. They probably will not pass validation. Don’t help with anymore forms, for sure.

EFCs of 0 are correlated with higher FAFSA verification rates, as the factors that often contribute to a 0 EFC assessment (no reported cash assets, no reported investments, etc) often trigger verification.

If the family truly is as wealthy as you say, they will for sure get caught.

In the mean time, stay out of it. It’s not your job and no good will come from stirring the pot when there’s already a system in place to catch this.

The family could be a $0 assets family. If they make under $25k, maybe they also qualify for some form of aid (SNAP, medicaid) and then they don’t have to report their 16 houses and cars.

Don’t help them anymore. Let her do her own scholarship applications.

Mind your own business and deal,with your own college search and selection…and payment.

There are PLENTY of financial things you might not actually know.

Not your business.

If this family really has income that should have been reported on the financial aid application forms, believe me…the schools will figure it out.

life lesson here. Not your business and if you make it your business nothing good will come of it. Truth be told you never know what goes on behind closed doors and you will find throughout your life that what appears to be true is all smoke and mirrors.
The couple you thought were a match made in heaven get a divorce and haven’t gotten along in years…they just didn’t air their dirty laundry in pubic so you didn’t know. The family you think are wealthy but are in debt up to their eyeballs due to any number of things life throws at us, self inflicted or otherwise. Point is you don’t know and you don’t need to know.
If they are cheating the chance they will get caught is high, colleges tend to pick through your financials more than the IRS. Assume there are things you do not know and concentrate on you. This isn’t child abuse, you have no moral or legal obligation to report it to anyone and I doubt your GC would either.

I would definitely not report it to the GC.

If you honestly believe that they are committing fraud, report it anonymously to the appropriate governmental agency. Be prepared for the fallout if they think you turned them in. That is why you must never mention it to anyone, except your parents if you trust them. However, since you actually lived with this family, yours may have issues, too.

OP - Your identity is thinly veiled if that is a photo of you on here. Don’t risk becoming a pariah in your home town. Try to believe in karma.

@annabanabelle Is that you in your avatar photo? First thing I would do if I were considering “dropping a dime” on an someone is to be as anonymous as possible – just saying!