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In My Opinion
Financial Fraud at Our Community Colleges
By Jon Coupal
The COVID-19 pandemic exposed California’s fiscal mismanagement in countless ways, most spectacularly in the payment of more than $30 billion—some estimates put the total as high as $55 billion —in fraudulent unemployment benefits. But another category of fraud could quickly balloon to numbers nearly that high unless more is done to stop it.
We’re referring to the enrollment of vast numbers of “bots” in California’s community college classes, and their apparent ease in obtaining financial aid even though they are fake students.
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One of the co-authors of this column uncovered this startling development as a professor of criminal justice at Pierce College in Woodland Hills, part of the Los Angeles Community College District. In September 2021, the Los Angeles Times reported that fraudulent applications to community colleges had surged to at least 65,000 in just a few months. It may be much worse now.
In April, CalMatters reported that an official in the state chancellor’s office told the publication that in January of this year, 25% of applicants to the state community college system were suspected to be fraudulent. The number of fake students applying “spiked like crazy” in the last year, according to an official of the Kern Community College District.
CalMatters made a Public Records Act request for specific data on fraudulent applications to the California Community College Chancellor’s Office (CCCCO), which oversees 116 individual schools. But the data that was made available was too generalized to be useful. Instead, CalMatters received combined data for the entire system from September 2021 to January 2024. It showed that “the colleges received roughly 900,000 fraudulent college applications and gave fraudsters more than $5 million in federal aid, as well as nearly $1.5 million in state and local aid.”
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It is likely that the true dimensions of the fraud will significantly exceed those numbers because, as the CalMatters’ investigation found, compliance with the Community College system’s reporting requirements is uneven at best.
In September 2021, the CCCCO mandated monthly reporting on fraud tracking. But a year after the required start date, some colleges had not yet complied, while others regularly missed reporting deadlines.
Admittedly, this is a challenging problem to solve. Enrollment has been declining in the state’s community colleges, and funding is tied to enrollment. That could give school administrators a financial incentive to look the other way and not investigate fraudulent enrollments too aggressively.
Another problem stems from the switch to remote learning, which has persisted past the pandemic. Even if it were the teachers’ responsibility to ensure that their students aren’t fake—a dubious proposition at best—it is difficult for faculty members to verify that students are real when they only appear as empty rectangles on a Zoom screen.
For teachers, there is a downside to raising the issue of student bots. If they identify so many bots that their own classes are canceled, their paychecks are put at risk. In one district, this has happened on more than one occasion.
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But in light of this problem, it shouldn’t be too much to ask for public agencies, including community colleges, to verify the identity of applicants before releasing financial aid or other benefits to them. California taxpayers can’t afford to support legions of fraudsters.
The state legislature should order an audit of the California Community Colleges application system, including financial aid applications. The State Auditor’s office can obtain the necessary records and make recommendations to ensure that California students get the classes and the financial assistance to which they are entitled, and that fraudsters can’t.
©Howard Jarvis Taxpayers Association