Functional Statements > Federal Student Aid

H. Program Compliance

The Program Compliance office is responsible for administering a program of monitoring and oversight of the institutions (i.e., schools, guaranty agencies, lenders, and servicers) participating in the Department of Education’s Federal Student Aid programs.  The office establishes and maintains systems and procedures to support the eligibility, certification, and oversight of program participants.  The office administers the Secretary’s authority to assess liabilities, fine, suspend, terminate or take other actions against schools and serves as the initial arbitrator of such actions against guaranty agencies, lenders, and servicers.  To accomplish this mission, the Program Compliance office is divided into the following units:

• School Eligibility Service Group
• Financial Institution Oversight Service Group
• Administrative Actions and Appeals Service Group
• Performance Improvement and Procedures Service Group
• Technical and Business Support Service Group

School Eligibility Service Group

The School Eligibility Service (SES) is responsible for administering a program of eligibility, certification, management improvement services, and oversight of schools, and their servicers, participating in the Department of Education Federal Student Aid Programs.  This compliance program, which also includes financial analysis and audit resolution, is administered in accordance with policies and procedures established by the Performance Improvement and Procedures Service and utilizing the automated systems and facilities developed and maintained by the Technical and Business Support Service.  To accomplish this mission, the School Eligibility Service is divided into the following divisions:

• School Participation Division - Northwest
• School Participation Division – South Central
• School Participation Division - Northeast

Each of these Divisions has responsibility for the oversight and management improvement services of specific schools assigned to them.  These Divisions have the following common responsibilities, which are carried out by their respective School Participation Teams: 

• Examines and analyzes to determine the approval or denial of the initial and renewal eligibility applications submitted by schools for participation in the Federal Student Aid program.
• Processes and maintains records of schools’ Program Participation Agreements and notices of eligibility to participate in the Federal Student Aid program.
• onitors schools and their agents through on-site and off-site reviews and analysis of various reports to provide early warning of program compliance problems and takes appropriate actions.
• Performs financial analyses and monitors financial status.
• Requests letters of credit and heightened cash monitoring actions.
• Manages and monitors missing / late audits and financial submissions.
• Schedules and conducts Clery Act and other compliance initiatives reviews, as needed.
• Manages the memorandum of understanding with the Federal Bureau of Investigation.
• Manages and performs data analysis on annual Clery reports and FBI data.
• Performs audit resolution.
• Identifies closed, bankrupt, and troubled schools and notifies appropriate Department of Education offices.
• Works with state agencies and accrediting agencies on closed schools and other issues.
• Identifies requirements for tuition recovery programs and coordinates the fulfillment of these requirements.
• Evaluates and acts upon the findings, conclusions, and recommendations produced by other FSA units, e.g. negative cash.
• Determines liabilities and/or recommends administrative actions.
• Works closely with and/or refers matters to the Office of the Inspector General and Administrative Actions and Appeals Service and other offices.
• Collaborates with Performance Improvement and Procedures Service on the development and/or revision of policies and procedures.
• Reviews and updates pertinent institutional databases.

School Participation Division - Northwest

The School Participation Division – Northwest is responsible for performing all of the above oversight and eligibility functions for its designated institutions. To accomplish this mission, the School Participation Division - Northwest is divided into the following Teams:

• San Francisco/Seattle School Participation Team
• Chicago/Denver School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

Chicago/Denver School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

School Participation Division – South Central

The School Participation Division – South Central is responsible for performing all of the above oversight and eligibility functions for its designated institutions. To accomplish this mission, the School Participation Division – South Central is divided into the following Teams:

• Atlanta School Participation Team
• Kansas City School Participation Team
• Dallas School Participation Team

Atlanta School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

Kansas City School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

Dallas School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools

School Participation Division - Northeast

The School Participation Division - Northeast is responsible for performing all of the above oversight and eligibility functions for its designated institutions, which includes foreign schools.  To accomplish this mission, the School Participation Division – Northeast is divided into the following Teams:

• New York/Boston School Participation Team
• Philadelphia School Participation Team
• Foreign School Participation Team

New York/Boston School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

Philadelphia School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for its designated schools.

Foreign School Participation Team

This Team performs the oversight functions described above under the description for the SES Divisions for foreign schools.

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Financial Institution Oversight Service Group

Financial Institution Oversight Service (FIOS) is responsible for administering a program of oversight of guaranty agencies, lending institutions, and servicers participating in the Department of Education Federal Family Education Loan (FFEL) Program.  The oversight activities are administered in accordance with policies and procedures established by the Performance Improvement and Procedures Service and utilizing the automated systems and facilities developed and maintained by the Technical and Business Support Service. 

FIOS conducts the following oversight functions related to audit resolution:

• Manages / monitors late / missing audits.
• Resolves external and internal audits (IPA and OIG) of FFEL program financial institutions.
• Reviews and evaluates the effectiveness of the institution’s correction / mitigation efforts of noted exceptions in audit reports.
• Works closely with or refers matters to the Office of the Inspector General and Administrative Actions and Appeals Service.
• Reviews and updates pertinent institutional and student databases.
• Collaborates with Performance Improvement and procedures Group on the development and/or revision of audit resolution policies and procedures.

To further accomplish its oversight mission, FIOS is divided into the following divisions:

• Financial Institution Oversight Division - Eastern
• Financial Institution Oversight Division - Northern
• Financial Institution Oversight Division - Southern

Each of these Divisions has responsibility for the oversight of guaranty agencies, lenders, and servicers participating in the Title IV loan programs, including conducting nation wide program review initiatives.  A complete description of the oversight functional responsibilities is provided below.

• Conducts risk assessment of financial institutions participating in the FFEL program.
• Conducts comprehensive and/or focused program reviews of guaranty agencies, lenders, and servicers.
• As required, monitors guaranty agencies, lenders, and servicers to obtain early warning and/or confirmation of issues related to program compliance and financial stability.
• Evaluates and acts upon the findings, conclusions, and recommendations produced by audit resolution.
• Determines liabilities and /or recommends fines.
• Monitors the Common Review Initiative process.
• Works closely with or refers matters to Office of the Inspector General and Administrative Actions and Appeals Service.
• Collaborates with Performance Improvement and Procedures Service on the development and/or revision of policies and procedures.
• Reviews and updates pertinent databases.

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Administrative Actions and Appeals Service Group

The Administrative Actions and Appeals Service (AAAS) administers the Secretary’s authority to fine, limit, suspend, terminate and take emergency actions against postsecondary educational institutions that participate in the Federal Student Aid programs.  In addition, AAAS administers the Secretary’s authority to resolve appeals of final audit and final program review determinations and the authority to initiate debarment and suspension proceedings against individuals.  AAAS also acts as the initial arbitrator of such actions against guaranty agencies, lenders, and servicers.  In performing its responsibilities, the activities of the Administrative Actions and Appeals Service include:

• Develops, initiates, and imposes Emergency/Termination/Limitation/ Suspension/Fine actions and assists in settlement negotiations with the Department of Education’s Office of General Counsel.
• Participates in the development/drafting of school revocations and most school recertification denials and coordinating of reconsideration appeals.
• Coordinates and resolves appeals by program participants from final audit and final program review determinations.
• Initiates debarments and suspensions.
• Issues warning letters to participating institutions for non reporting violations prior to initiating adverse administrative actions/imposing sanctions.
• Participates in on-site reviews with program review teams.
• Acts as advisor to the SES & FIOS leadership on adverse administrative actions.

Performance Improvement and Procedures Service Group

The Performance Improvement and Procedures Service provides support to both SES and FIOS through the development and review of policy, procedure development and refinement, training, and resolution of difficult matters.  This organization also works closely with the Technical and Business Support Service (TBSS) in planning, structuring and delivering guidelines and training.  Specifically, this organization’s responsibilities include:

• Serves as a liaison to Federal Student Aid’s policy organization to provide recommendations for policy development and communicating policy decisions back to Program Compliance.
• In partnership with Federal Student Aid’s policy organization, represents Program Compliance in addressing regulatory and statutory changes with the Office of Postsecondary Education (OPE).
• Conducts quality assurance evaluations to determine the effectiveness of SES and FIOS procedures.
• Assists SES and FIOS in drafting, refining, and communicating changes in business process procedures.
• Coordinates with TBSS in the development and training of SES and FIOS staff in the use of program compliance automated systems.
• Reviews and evaluates programmatic publications for consistency with established policies and procedures (e.g., Federal Student Aid Handbook, Audit Guide, Federal Student Aid Coach, Blue Book, etc.).

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Technical and Business Support Service Group

Technical and Business Support Service (TBSS) is responsible for managing the design, development and maintenance of automated information systems provided in support of SES and FIOS.  To accomplish its mission, TBSS is divided into two Divisions:  Operations Support Division and the Technical Management Division. 

Operations Support Division

The Operations Support Division provides stable operations by establishing and managing policies, procedures, and guidelines for the TBSS systems.  It gathers requirements, analyzes risk, and validates user requirements and system issues, recommending solutions that provide the best value.  It is responsible for the management of earned value on significant development projects as needed.  The Division performs quality control reviews to ensure business needs are consistently being met, and conducts data integrity and reconciliation activities to consistently provide and maintain reliable data and reporting.  It provides support to the Risk Analysis Model and triggers, and provides reports and data to other Department and external parties as required.

Technical Management Division

The Technical Management Division is responsible for managing IPM application technology infrastructure, liaison with the Virtual Data Center (VDC), oversight of the Configuration Management Process (CMP), and support of the Routing Identifier (RID) and OPEID crosswalk used by other Federal Student Aid systems.  This Division participates in meetings with other enterprise initiatives/projects and is responsible for performing impact analysis and advising management of any technical issues or risks pertaining to TBSS systems.  The Division manages, develops and implements procedures in compliance with system security policies and ensures development and periodic revisions of System Security Plans (SSP) and Disaster Recovery Plans (DRP).  The Technical Management Division ensures that periodic Certification and Accreditation (C&A) of IPM systems are done in a timely manner and corrective actions are executed for all identified findings and vulnerabilities.  It supports audits on TBSS systems by other agencies like GAO, IG or any other independent agency authorized by Federal Student Aid.  It is responsible for and adherence to Configuration Managements Plans (CMP), coordination of and participation in the Change Control Board (CCB) meetings and testing processes.

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