What About Fairness?

The news stories left one feeling, yet again, that some wealthy parents will do just about anything to get their kids into college and to help them pay for it.

According to ProPublica Illinois and The Wall Street Journal, the scheme worked this way: wealthy parents would give a relative or friends guardianship of their high school kids. The children would then exercise their right to become financially independent of their guardians and qualify for federal, state or institutional aid. A college consulting group -- Destination College -- allegedly encouraged the behavior. (The consulting group didn't return calls.) And the Education Department is investigating.

Dozens of parents did this for their children -- even though the parents lived in some of Chicago's wealthiest suburbs.

The two journalism organizations each identified 40 families that have done this in the last two years. Talk radio was not kind to the families, noting that once again the system appeared to be designed for those willing to take advantage.

In the world of higher education, the reports left people scratching their heads. If doctors and lawyers do this, what can possibly be left for average folks or the truly poor?

The uncomfortable truth is that it may be easier to point out the flaws of the system than to fix it.

Mark Kantrowitz, who has published a book advising parents on college costs, called it "a fraud."

One hears from time to time about wealthy parents somehow finding a way to make themselves appear not too wealthy. But in this case the parents may have been acting legally.

"This is the first time I've ever heard of this thing," Kantrowitz said.

"Undoubtedly this is about more than the Chicago suburbs." he said. "This could be the tip of the iceberg."

Jill Desjean, a policy analyst with the National Association of Student Financial Aid Administrators, said the problem is that the situation is "technically legal." There aren't long lists of questions (now) that parents must answer about why they are giving up their guardianship rights.

Desjean said that there are legitimate reasons that students are placed into guardianship situations -- and not just for those who are wealthy. She urged members of Congress and others who want to promote change to do so with enough time to find out how many students are being placed into guardianships legitimately.

David Hawkins, executive director for educational content and policy at the National Association for College Admission Counseling, said, "I do not know of evidence of a similar situation elsewhere, although the notion that parents will shuffle assets and generally make their financial position as advantageous as possible for financial aid purposes seems to be a well-worn path."

As for preventing abuses, "it does seem the discrepancy in the addresses listed on the admission application and the financial aid forms served as a trigger (though only after being pointed out by the counselor, at least as I read it). So a process of matching addresses could identify discrepancies, which in itself would not be evidence of wrongdoing, but could be a resource for colleges to review. It’s possible that institutions already do this, so there again the practitioners themselves would be best able to attest."

Colleen Ganjian, an independent counselor in Washington, said "it's pretty crazy" what has been going on in Chicago and perhaps elsewhere.

And she said that it was especially interesting to see parents who are wealthy claim that they are in need.

"A lot of families feel like they have no options to pay for college," she said. "I have worked with families who earned $200,000 a year who cannot afford the public universities in their state."

Ganjian was quick to acknowledge that this would only be true in a place like Washington or New York City or Chicago, where the scandal is breaking.

"I think that when these situations happen, we get caught up the gossip, but there are real issues," she said.