Ethical Standards
Code of Conduct
Aaron Steffens
MASFAA President 2014-2015
Associate Director of Financial Aid, Luther Colllege
Giving Appropriate Credit
This presentation is a creation of
Eileen O’Leary’s, our 2014-15
NASFAA National Chair, and I am
presenting it with her permission.
Financial Aid
Professionals:
Serving Multiple
Masters
• Institutional conduct vs. personal
professional standards
 The Institution
 Following the mission
 The Self
 Following a personal code
• Established standards and guidance
is essential to assure the public of
the profession’s integrity
 The Government
 Following law and
regulation
 Students and their
Families
 Following their dreams
• Recognizing the overarching national
goal of an educated citizenry,
provide access to education to insure
the continuation of a strong
democracy
Professional Ethics
Personal and organizational
standards of behavior expected of
professionals who exercise
specialized knowledge and skill.
WHY Ethics in the Financial Aid Office?
• Because of our unique experience and
training, financial aid professionals make
judgments, apply skills, and reach informed
decisions in situations that the general
public cannot.
• Expertise comes with responsibility
NASFAA & Ethics
• If we do not police ourselves as a profession,
other will do it to/for us.
• Provide “cover” for FAO’s if confronted by higher
administration
• NASFAA members must
– exemplify the highest level of ethical behavior in
helping students and families find the best ways to pay
for college
– demonstrate the highest level of professionalism
– do both while remaining good stewards of public and
institutional funds
History
• April 1999: NASFAA’s Board adopts 12-point
Statement of Ethical Principles, to serve as a common
foundation for the profession
• May 2007: following investigations by NYAG Cuomo
related to improper relationships with lenders, Board
adopts more prescriptive Code of Conduct to outline
specific standards/expectations for FAAs—and assure
the public of the profession’s integrity
• 2013-14: NASFAA Board appoints Task Force on
Ethical Standards to re-examine Principles and Code in
light of new issues, challenges, and dynamics in higher
ed. New Code and Statement adopted March 2014.
Current Update: Process
• 2013-14: Ethics Task Force, chaired by Mary
Sommers (Univ. of Nebraska – Kearney) meets with
legal counsel, members, and others to examine and
update Statement and Code.
• March 2014: Following a 30-day member comment
period, Board approves new Statement and Code.
• September 2014: Following detailed review at June
2014 Board meeting and a 30-day member
comment period, Board approves new Enforcement
Procedures for Code.
Statement v. Code
Statement of Ethical
Principles
Code of Conduct
Aspirational: goals to hold
before us
Prescriptive: specific rules of
conduct
NASFAA members should
strive toward these goals
NASFAA members must
comply as a condition of
membership
Detailed enforcement
procedures
No process for enforcement
NASFAA Statement of Ethical Principles
Financial aid administrators shall:
Advocate for students
• Remain aware of issues affecting students,
advocate for their interests at the institutional,
state and federal levels
• Support federal, state and institutional efforts to
encourage students, as early as the elementary
grades, to aspire to and plan for education
beyond high school.
NASFAA Statement of Ethical Principles:
Financial aid administrators shall:
Manifest the highest level of integrity
• Commit to the highest level of ethical behavior; refrain
from conflict of interest or its perception
• Deal with others honestly and fairly, abide by
commitments, acting in a manner that merits the trust
and confidence others have placed in us
• Protect privacy of individual student financial records
• Promote the free expression of ideas and opinions,
foster respect for diverse viewpoints in the profession
NASFAA Statement of Ethical Principles
Financial aid administrators shall:
Support student access & success
• Commit to removing financial barriers to pursuing
postsecondary learning; support admitted students
• Without charge, assist students in applying for financial aid
• Provide services and apply principles that do not
discriminate on the basis of race, gender, ethnicity, sexual
orientation, religion, disability, age, or economic status.
• Understand the need for financial education and commit to
educate students and families on how to responsibly
manage expenses and debt.
NASFAA Statement of Ethical Principles
Financial aid administrators shall:
Comply with federal and state laws
• Adhere to all laws and regulations governing federal,
state, and institutional financial aid programs
• Actively participate in ongoing professional development
to ensure ample understanding of statutes, regulations,
and best practices governing the financial aid programs
• Encourage colleagues to participate in the financial aid
professional associations at the state, regional, and
national levels; help other aid professionals as needed
NASFAA Statement of Ethical Principles
Financial aid administrators shall:
Strive for transparency and clarity
• Provide students and parents with the information needed to
make good decisions about attending and paying for college
• Educate students and families through quality information that
is consumer-tested when possible, including transparency and
full disclosure on award notices
• Ensure equity by applying need-analysis formulas consistently
across the institution’s financial aid applicants
• Inform institutions, students, and parents of any changes in
financial aid programs that could affect student aid eligibility
NASFAA Statement of Ethical Principles
Financial aid administrators shall:
Protect the privacy of financial aid applicants
• Ensure that student and parent information provided to the
financial aid office is protected in accordance with state
and federal statutes and regulations, including FERPA and
the HEA, Section 483(a)(3)(E) (20 U.S.C. 1090)
• Protect information on FAFSA from inappropriate use,
ensuring it is only used for the application, award, and
administration of federal, state, and institutional aid *
NASFAA Code of Conduct
(Required of all members)
1. No action will be taken by financial aid staff
that is for their personal benefit or could be
perceived to be a conflict of interest
a) Employees within the financial aid office will not
award aid to themselves or their immediate family
members. Staff will reserve this task to an
institutionally designated person, to avoid the
appearance of a conflict of interest.
NASFAA Code of Conduct
(Required of all members)
b) If a preferred lender list is provided, it will be
compiled without prejudice and for the sole benefit of the
students attending the institution.
The information about lenders and loan terms will be
transparent, complete, and accurate.
The process through which preferred lenders are elected
will be fully and publically disclosed.
Borrowers will not be auto-assigned to any particular
lender without their consent.
NASFAA Code of Conduct
(Required of all members)
c.) Borrower’s choice of a lender will not be denied,
impeded, or unnecessarily delayed by the institution,
even if that lender is not included on the institution’s
preferred lender list.
NASFAA Code of Conduct
(Required of all members)
d) No amount of cash, gift, or benefit in excess of a de
minimis amount shall be accepted by a financial aid staff
member from any financial aid applicant (or his/her
family), or from any entity doing business with or
seeking to do business with the institution (including
service on advisory committees or boards beyond
reimbursement for reasonable expenses directly
associated with such service).
NASFAA Code of Conduct
(Required of all members)
2. Information provided by the financial aid office
is accurate, unbiased, and does not reflect
preference arising from actual or potential
personal gain
NASFAA Code of Conduct
(Required of all members)
3. Institutional award notifications and/or other
institutionally provided materials shall include
a) Breakdown of individual components of institution's
COA, designating all potential billable charges
b) Clear identification of each award, indicating type of
aid, i.e. gift, work, or loan aid
c) Standard terminology and definitions, using
NASFAA’s glossary of award letter terms
d) Renewal requirements for each award
NASFAA Code of Conduct
(Required of all members)
4. All required consumer information is
displayed in a prominent location on the
institutional web site(s) and in any printed
materials, easily identified and found, and
labeled as “Consumer Information.”
NASFAA Code of Conduct
(Required of all members)
5. Financial aid professionals will disclose to
their institution any involvement, interest in,
or potential conflict of interest with any
entity with which the institution has a
business relationship
Purpose of Enforcement of the Code
• Goal 1: educate and assist members
about their ethical responsibilities
• Goal 2: sanction those who are unwilling
or unable to meet their ethical obligations,
as a last resort
Enforcing the Code of Conduct
• Assumption: members intend to comply with the Code.
Promulgation and interpretation of the Code is, first and
foremost, educational.
• Enforcement Procedures are designed to provide:
– appropriate notice
– opportunity to respond and be heard
– objective decision-making
•
Sanctions imposed ONLY as a last resort for willful
noncompliance or severe breaches of the Code
Inaugural Ethics Commission
Commission Member
Ethics Commission Chair
Tenure
Mary Sommers, RMASFAA
National Chair, Chair Elect & Past
National Chair
Eileen O’Leary
Dan Mann
Ron Day
4 to 6 additional members, no
fewer than 2 of whom are current
or former NASFAA Board members
NASFAA President (ex-officio,
voting)
NASFAA Secretary (ex-officio, nonvoting)
Janice Dorian, EASFAA
Runan Pendergrast, SASFAA
Jim Brooks, WASFAA
Jim Swanson, RMASFAA
Pam Fowler, MASFAA
Lisa Hopper, SWASFAA
Justin Draeger
Beth Maglione
Who must comply?
• Enforcement Procedures apply to
– each NASFAA member institution, and
– each senior-level professional at the institution who
oversees and administers student aid programs
• NASFAA determines in each proceeding whether
to focus an inquiry on:
– a member institution,
– its relevant financial aid professionals, or
– both
Who can submit a complaint?
• ANY entity or individual may lodge a written complaint
concerning possible violation of the Code. Complaints
MUST include:
–
–
–
–
–
–
–
–
–
•
name,
employer,
position,
address,
e-mail address,
telephone number,
signature (digital or written) of the complainant,
a specific reference to the Code sections allegedly violated, AND
a description of the alleged violation itself based on facts that have
occurred within the previous 12 months.
Complaint may be dismissed without all of the above
Sanctions
The following sanctions may be imposed on those found to
have violated the Code of Conduct:
1. Statement of Concern: non-public, corrective action has
been taken; reserved for minor infractions
2. Reprimand: non-public rebuke, may include a
recommendation for NASFAA or other education or training
pertinent to the violation
3. Temporary Suspension: public suspension from NASFAA
membership for a stated period of time
4. Permanent Suspension: public suspension from
membership; permitted to re-apply to NASFAA—with
appropriate documentation of improvement—after five
years
Examples: What’s a FAA to do?
• Development wants you to provide them
with students’ families’ incomes
• A rep from a lending institution asks you to
join her for dinner at a conference. The
company wants to be on your PLL
• A family is asking for additional aid and
brings you a $75 gift certificate to Macy’s
• A director offers scholarships for “favors”
NASFAA Resources
• Glossary of Financial Aid Terminology
– http://www.nasfaa.org/glossary.aspx
• Today’s News features utilizing Mr. Ethics
• Questions?
• Concerns?
• Feedback?