Prevent Admissions Fraud at Your Higher Education Institution
In the wake of the recent admissions scheme revelations stemming from Operation Varsity Blues and ongoing investigations, we’ve heard from many of you, particularly governing board members, asking how you can avoid such a scandal at your college or university. There are indeed several reviews and control procedures that can help you mitigate the reputational and financial risks of fraud and collusion, faulty judgment, and even unintentional errors in the admissions process.
Admissions fraud isn’t entirely new to higher education, but the magnitude and reach of Operation Varsity Blues is jarring, and leaders across the industry are reconsidering ways to strengthen the integrity of their admissions processes. Fraud uncovered by Operation Varsity Blues included bribes to athletic coaches and school administrators, but other crimes, such as bribes to admissions test monitors, falsification of exam scores, and fabrication of student biographies, were outside the affected institutions’ control. The scope of your policies and procedures should reach, to the extent they can, all organizations involved in your admissions system.
Examine audited procedures first
Start by performing a rigorous risk assessment of the audited procedures that could impact your financial statements, particularly those related to NCAA agreed-upon procedures and student financial aid. Consider lowering thresholds or testing 100 percent of contribution populations, testing organizations affiliated with and outside of the institution, and closely scrutinizing athletic aid awarded to non-athletes (typically reported within the “expenses not related to specific teams” category). It’s also a good idea to evaluate the internal controls governing these processes and test their effectiveness.
Next, evaluate operational policies
There are other steps we recommended as you review your operational policies.
- Strengthen or establish admissions policies to include documented procedures for admissions exceptions and special cases. Be sure to track and monitor applicants admitted through exception for later inspection and verification. Establish multiple and independent levels of review for admissions exceptions.
- Enhance controls on the verification of athletic recruits, with multiple independent levels of review. Require another layer of documentation with the original application packet.
- Audit your athletic rosters at the start and conclusion of every academic year, and cross-check rosters with admitted student lists and admitted student exceptions. Periodically review recruits or new athletes who have discontinued their participation in a sport.
- Review your incentive compensation policies, procedures, and job descriptions for any position related to the recruitment, admission, and administration of the financial aid to the student.
- Shore up policies governing conflicts of interest, ethics, and disclosure requirements in your admissions, financial aid, and athletics employee hiring and training practices.
- Ask your internal audit department to include athletics in its audit plan for the coming year.
- Study the NACUBO brief on Operation Varsity Blues, issued on March 29, 2019, for strategies that may help your school steer clear of admissions fraud.
The Department of Education is highly sensitive to this matter and will likely be issuing policy and procedure guidance in the near future. In the meantime, these are prudent steps to take in managing the risks of admissions fraud.
How we can help
CLA’s higher education professionals can assist your internal auditor, serve in a co-sourced or outsourced internal audit capacity, and provide advisory services to assess your risk environment and the internal controls over admissions, financial aid, advancement, and athletics. We can also conduct forensic investigations of fraud and misconduct in cases of suspected abuse.