"Many financial aid advisers are worried that the Trump administration’s latest effort to bolster identity verification in the student aid system could have unintended consequences. Instead of simply catching fraudulent grant applicants and borrowers, some fear that the verification process could also prevent real, eligible students from accessing public benefits," Inside Higher Ed reports.

..."While aid officers generally support the concept of catching identity thieves, they fear that requiring students to complete the verification process so quickly could delay or even block aid access for some legitimate students, putting them in a financial hole. FSA says the program will eventually be automated, limited to first-time students and managed by agency officials. But at the moment, it’s a manual process that can affect students midway through their program; financial aid officers say it is becoming increasingly complicated and burdensome.

'Schools have been asking for help on how to find these people and prevent fraudulent identities from obtaining Title IV aid, so we’re very supportive of the Department of Ed’s attempts to assume responsibility,' said Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators. 'Unfortunately, the timing and how long it took ED to get this off the ground means that it’s August … We are entering, if not already in, the season of really large-scale disbursement. If verification is outstanding, schools may have to hold disbursements for those students.'

The largest unknown seems to be what the consequences of an incomplete or overdue identity verification will be."

NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.

Publication Date: 8/27/2025