The Government Accountability Office released a report Wednesday detailing ways for the Department of Education's Office of Federal Student Aid to improve its oversight of lenders and third-party servicers involved in the Federal Family Education Loan Program.
The report urged the department's inspector general to update its FFEL Lender Audit Guide to reflect standards put into place since the guide was last published in 1996. (In a response, Kathleen Tighe, the inspector general, said that a new guide will be out by the end of the year.) It also called for the department to address identified gaps in the policies and procedures used in Federal Student Aid's review of audited financial statements for lender servicers involved in the FFEL program. Those issues, the department said, could be remedied in part by revisions to the guide.
GAO found fewer concerns in the Direct Loan program, but urged the department to step up its oversight as the program grows.