Finding Text
CFDA Number: 84.268 Federal Direct Loans Criteria: Per 34 CFR 668.165(a)(3), the College must notify the student or parent of an anticipated Direct Loan disbursement in writing no earlier than 30 days before, and no later than 30 days after, disbursing the loan to the student?s account. Condition: For 4 out of 40 students tested, no notification was sent to the student or parent for the Direct Loan disbursements made on August 22, 2022. Cause: The incorrect award year (AY21-22) was entered for loan disbursement notifications for any disbursements that were made on August 22, 2022. All loan disbursements made on August 22, 2022 were part of award year 2022-2023. As a result of the above human error, no notifications were sent to students for the August 22, 2022 disbursements. Effect: The College is not in compliance with the federal regulations regarding the notification of direct loan disbursements to students. Prevalence: There were no notifications sent out for direct loan disbursements on August 22, 2022. The College verified that this was the only day affected by reviewing each disbursement date related to the fiscal year 2022 and verifying inputs into the notifications were done correctly. The error was corrected the next day and notifications were appropriately sent since August 23, 2022. A list of all students who received Direct Loans on August 22, 2022 was obtained and reviewed, noting that this affected 909 students. Recommendation: The College should have improved training procedures for the accounts payable staff responsible for inputting the criteria for notifications. The College should also enhance their review procedures, such as implementing a checklist to be completed by accounts payable staff each day and reviewed by Comptroller or other secondary review control over accounts payable staff, to ensure that the correct award year and other key inputs are used when setting parameters for Direct Loan disbursement notifications.