Department of Education IG Reveals $6 Billion In Improper Payments in 2016

By Gage Cohen | June 1, 2017 | 12:35pm EDT
Kathleen Tighe, inspector
general for the Education Department.  (CSPAN)

( - Department of Education Inspector General Kathleen Tighe revealed to Congress last week that the Federal Student Aid office (FSA) had made over $6 billion in improper payments last year in federal student aid programs.

These improper payments included sending money in the wrong amount, making unnecessary disbursements, and sending payments to the wrong recipients entirely, reported the government watchdog group Judicial Watch. 

There were $2.21 billion in improper Pell Grant payments and $3.86 billion in the Direct Loan program, according to Inspector General Tighe in her May 25 testimony before the House Subcommittee on Government Operations.

Furthermore, Tighe testified that the Education Department had not yet begun to consider the logistics of how it would “address the root causes of the identified improper payments.”

James Runcie, the chief operating officer of the FSA and an Obama political appointee, was scheduled to testify at the same hearing but he resigned his position and did not appear at the hearing.

James Runcie, the recently resigned chief operating officer of the Office of

Federal Student Aid. (Department of Education)

In his resignation memo, Runcie said he had been “consistently on record and clear about not testifying at the upcoming hearing on improper payments” and that he had “not heard a single compelling reason” as to why he should testify.

Tighe testified that the problem of improper payments had only gown worse over the last few years. There was a 330 percent increase in the amount of money improperly paid from the previous year, 2015, she said.  

The Department of Education contends that its failure to reach certain standards was not due to the number of improper payments, but to “changes in estimation methodologies.”

However, the inspector general “found that the Department’s improper payment reporting, estimates, and methodologies were generally accurate and complete.”

The Federal Student Aid office is responsible for over $1.4 trillion in student aid.

Tighe closed her testimony by saying she is “seeing that the Department is making progress in its efforts to measure improper payments and we remain committed to identifying improper payments and recommending corrective actions.”


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