My college had me listed in their system as an on campus student for two semesters when I was an online student. This allowed me additional financial aid I should not have received as an online student. I did not know the error existed, and when my refund check came from the school, I did not question the amount.
After two semesters, FAFSA discovered the error and requested the additional aid back from the school, who in turn billed me for their mistake, since I was issued the money.
My question is, do I have any grounds to hire a lawyer to fight the amount the school has billed me for their mistake?
Education Law Attorney
Setting aside whether or not there is any merit to your position, you need to first consider if the amount you may owe warrants hiring an attorney. If for example, the amount you owe is $5,000.00 and the anticipated legal fee will be near or more than that amount, then it makes no sense to hire a lawyer.
Since you seem to acknowledge that you financially benefited from a mistake, even if it was unknown at the time, you may be required to return the money. As a practical matter, you may choose to contact the school and see if you can work out a deal by which you pay a compromised amount over an extended period of time. If the school chooses not to negotiate, then you may want to consider contacting an attorney who will try to negotiate a resolution with the school's lawyer. A lawyer can probably agree to put a limited amount of time to perform this function, which should cost a few hundred dollars. If a negotiated compromise does not occur, then your lawyer can advise you about what if any consequences exist. Good luck
The information presented herein is intended to be informational, and not legal advice. Obtain competent legal representation for your particular matter.
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Education Law Attorney
Your case is unique to you, but not necessarily unique. There have been a history of abuse of the FAFSA process where there was intentional falsification of FAFSA applications by college and university financial aid officers and staff.
Although there are few legal cases readily reviewable, a recent decision by the 7th Circuit Court of Appeals, "Leveski v. ITT Educ. Servs., Inc." (7th Cir., 7-8-2013), found that such activity by ITT Educational Services merited a claim "on behalf of the United States, pursuant to the qui tam provision of the False Claims Act (FCA), 31 U.S.C. § 3730(b)", more commonly known as the "whistle-blower statute". Therefore, the "mistake" may be the college's attempt to correct just a mistake or correct prior fraudulent activities. In any case, your situation may merit further investigation.
You should look for an attorney who litigates "whistle blower" cases. Such an attorney may be able to help you. If you do not wish to go that route, you may qualify to have the overpayment of the "student loan forgiven, canceled, or discharged". Go to the link below for more information.