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Wealthy Parents in Illinois Exploit Loophole to Earn Financial Aid and Scholarships

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  • Reports by the Wall Street Journal and ProPublica show that affluent parents in Illinois are transferring the guardianship of their children to friends and family in an effort to save on college tuition.
  • By transferring legal custody, the child can identify themselves as financially independent from their families on financial aid applications, resulting in more aid money.
  • This practice is legal, however, school officials are calling the practice unethical, and the Education Department is looking into the matter.

Illinois Families Game Financial Aid

Recent reports show that affluent parents in Illinois are transferring the guardianship of their children to friends and other relatives so that their children will be awarded more financial aid money when applying for college.

According to both ProPublica and the Wall Street Journal, at some point during their child’s junior or senior year of high school, families will legally give custody of their child to a friend or family member. This allows their child to identify themselves as financially independent from their families when they apply for financial aid and college scholarships and can result in the student receiving more money.

The Journal spoke to one Chicago-area family that used this practice, which is legal. The family they spoke to makes over $250,000 in annual income and live in a house valued at over $1 million. The mother claimed that they had already spent over $600,000 on college tuition on older kids.

After their daughter’s guardianship was transferred, the only income she had to claim was a little over $4,000, which she earned from a summer job. She ended up attending a private school with a tuition of $65,000, and got $27,000 in merit scholarships and $20,000 in need-based aid.

The family told the Journal that the process of transferring guardianship pretty easy and mainly just involved paperwork. The co-worker taking custody had to attend one court hearing, but the daughter did not have to go, and neither did her parents.

Logistics and Potential Consequences of the Process

Even though this practice is legal, colleges in Illinois are concerned about its use and question the morality behind it. But still, several schools in Illinois are starting to take a closer look at the situation.

Andrew Borst, the director of undergraduate enrollment at the University of Illinois told the Journal it could take opportunities away from students who actually come from low-income families.

“Our financial-aid resources are limited and the practice of wealthy parents transferring the guardianship of their children to qualify for need-based financial aid—or so-called opportunity hoarding—takes away resources from middle- and low-income students,” he said. “This is legal, but we question the ethics.”

The Journal looked at court documents and found 38 cases where juniors or seniors in high school had their guardianship transferred. Many of those families lived in homes valued over half a million dollars.

In Illinois, even if a parent can provide care to a child, a court can still transfer guardianship so long as the parents relinquish care, the child and the new guardian consent, and a court finds that it is in the child’s best interest. In most of the 38 cases, the language used to justify why it is in the child’s best interest usually resembled, “The guardian can provide educational and financial support and opportunities to the minor that her parents could not otherwise provide.”

ProPublica spoke to someone who became a child’s legal guardian for this reason. He said he wrestled with the ethics of the matter, because his wife works at a college, so he saw the situation from both sides. They were afraid that by doing this, they could take aid away from another family, even though he was told this would not be the case.

“It’s one of these gray areas, and my heart wanted me to do it for the family,” he said to ProPublica. “But I also have a conscience. I wanted to make sure we were doing the right thing.”

Consulting Firm Behind the Practice

So, how did these families manage to do this? Both the Journal and ProPublica say that many followed a path created by a consulting firm called Destination College. The group is based in Chicago and says it works to make college more affordable for families and their children.

“Our team of tax, financial and academic planning experts specializes in creating a customized guide, making sure the students are matched to the major and school of their interests, and the parents can comfortably afford it,” Destination College’s website says.

The firm claims to save students an average of $30,000 a year on college. Nowhere on the site does it directly suggest that families transfer the guardianship of their child, but there is language that could be hinting at the practice.

Destination College offers three packages: Basic, Preferred, and Premier. One of the features in the Premier package is: “College Financial Plan, Using Income and Asset Shifting Strategies to Increase Your Financial and Merit Aid and Lower Out of Pocket Tuition Expenses.”

Lora Georgieva, the founder of Destination College, has denied giving comments to both outlets.

According to the Journal, the Education Department is reportedly looking into this practice. It is currently unclear whether or not this is happening in any states outside of Illinois. However, other schools in the midwest have been alerted about the practice, and some have said they will keep an eye out for evidence of its occurrence.

In order to prevent this from happening in the future, some have recommended amending language in the Federal Student Aid handbook.

One suggestion given to the Journal read, “If a student enters into a legal guardianship, but continues to receive medical and financial support from their parents, they do not meet the definition of a legal guardianship and are still considered a dependent student.”

See what others are saying: (Wall Street Journal) (ProPublica) (HuffPost)

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After Uvalde, Politicians, Public Figures, Gun Violence Survivors, and More Call For Change

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“When are we going to do something?” Golden State Warriors Coach Steve Kerr asked during an emotional plea at a press conference. 


Uvalde Shooting Kills 21 People

Democratic politicians, activists, and many others are calling for gun reform in the United States after 19 children and two teachers were killed in a Tuesday shooting at Robb Hill Elementary School in Uvalde, Texas.

The 18-year-old suspected gunman was reportedly killed by officers. The massacre marks the 27th school shooting of 2022, according to Education Week.

It also comes just a week and a half after 10 people were killed in a shooting in Buffalo, New York, and another shooting in a Southern California church left one person dead and several others injured.

Sen. Chris Murphy (D-Ct.) spoke fervently on the Senate floor Tuesday, slamming his colleagues for refusing to pass gun control legislation that could prevent future shootings. 

“What are we doing?” he asked of his fellow lawmakers. “Why do you spend all this time running for the United States Senate? Why do you through all the hassle of getting this job, of putting yourself in a position of authority, if your answer is, as the slaughter increases, as kids run for their lives, we do nothing? What are we doing? 

“Why are you here if not to solve a problem as existential as this?” he continued. “This isn’t inevitable. These kids weren’t unlucky. This only happens in this country.” 

“And it is a choice. It is our choice.”

President Joe Biden likewise urged action by supporting the now-expired assault weapons ban.

“We can do more. We must do more,” he added.

Public Figures And Shooting Survivors Speak Out

The demands for change spread far past political figures. Golden State Warriors coach Steve Kerr took time out of a pre-game press conference to passionately plead for common-sense gun control. He specifically called on Senators to vote on H.R. 8, a background check bill previously passed in the House.

“When are we going to do something?” Kerr asked while slamming his hands on the table.  

“I ask you, Mitch McConnell, I ask all of you senators who refuse to do anything about the violence and school shootings and supermarket shootings. I ask you: Are you going to put your own desire for power ahead of the lives of our children and our elderly and our churchgoers?” Kerr continued. “Because that’s what it looks like.” 

He went on to say that Americans, who largely support background checks, are “being held hostage by 50 Senators who refuse to even put it to a vote.” 

Grammy Award-winning musician Taylor Swift shared his message, adding that she is filled with “rage and grief” not just from the shootings, but by “the ways in which we, as a nation, have become conditioned to unfathomable and unbearable heartbreak.”

“It doesn’t have to be this way,” tweeted David Hogg, an activist and survivor of the 2018 school shooting in Parkland, Florida. “The way we will make this time different is by Americans on both sides of the aisle collaborating on what we can agree on to get something done even if small. Kids are dying we have to do something.”

Manuel Oliver, the father of one of the children lost in the Parkland shooting, slammed the inaction of politicians in an interview on CBS News

“The families don’t need your freaking hearts,” Oliver said. “They need their kids, and the kids are not there anymore. So I feel very angry and offended and I just don’t understand how come a whole society doesn’t wake up.” 

People impacted by the 2012 Sandy Hook shooting also spoke out, including Mary Ann Jacob, who worked as a librarian at the school during the shooting.

“I’m so sorry those deaths did not change our world,” Jacob wrote. 

Texas-based figures felt especially compelled to stand up as the tragedy hit so close to home. Academy Award-winning actor Matthew McConaughey, whose hometown is Uvalde, wrote a message on social media asking Americans to “take a longer and deeper look in the mirror and ask ourselves, ‘What is it that we truly value?’”

“We have tragically proven that we are failing to be responsible for the rights our freedoms grant us,” McConaughey wrote. 

“Action must be taken so that no parent has to experience what the parents in Uvalde and the others before them have endured.”

Fellow Texas native Selena Gomez also took to social media to argue for action.

“If children aren’t safe at school where are they safe? It’s so frustrating and I’m not sure what to say anymore,” the “Only Murders in the Building” star wrote on her Instagram story. “Those in power need to stop giving lip service and actually change the laws to prevent these shootings in the future.”

We make it a point to not include the names and pictures of those who may have been seeking attention or infamy and will not link out to websites that might contain such information.

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Lawmakers Call For Action as Oil Companies Post Record Profits Amid Rising Gas Prices

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A recent analysis from the Center for American Progress found that the top five oil companies earned over 300% more in profits during the first quarter of 2022 than the same period last year.


As Consumer Prices Climb, Big Oil Profits

American oil companies are facing increased scrutiny over profiteering practices as gas prices continue to surpass record highs driven by Russia’s ongoing war in Ukraine.

Last week, costs surged to above $4 per gallon in all 50 states for the first time ever, according to the auto club AAA. Prices are currently averaging over $4.59 per gallon nationwide, which is 50% higher than they were this time last year.

In addition to consumers hurting at the pump, there are also rising concerns for industries that rely on fuel and oil like trucking, freight, airlines, and plastic manufacturers. 

To account for high prices, some in sectors have responded by ramping up prices further down the supply chain to account for costs, putting even more of a burden on consumers to pay for everyday items.

But as Americans struggle with sky-high gas prices at a time of record inflation, recently released earnings reports show that many of the world’s largest oil companies thrived in the first quarter of 2022.

ExxonMobil more than doubled its earnings from the same period last year, reporting a net profit of $5.5 billion. Meanwhile, Chevron logged its best quarterly earnings in almost a decade, and Shell had its highest earnings ever.

According to a new analysis conducted by the Center for American Progress, the top five oil companies — including the three mentioned above —  earned over 300% more in profits this quarter than during the same time last year.

“In fact, these five companies’ first-quarter profits alone are equivalent to almost 28 percent of what Americans spent to fill up their gas tanks in the same time period,” the report noted.

Per Insider, for at least four of those companies, that growth marks a tremendous increase in profits from even before the pandemic.

Lawmakers Ramp-Up Efforts to Reduce Prices

To address these startling disparities, federal lawmakers have moved in recent weeks to increase pressure on oil companies and take steps to lower prices.

On Thursday, the House of Representatives passed a bill proposed by Rep. Katie Porter (D-Ca.) that aims to reduce gas prices. The legislation, called The Consumer Fuel Price Gouging Prevention Act, would give the president the authority to issue an Energy Emergency Declaration that would be effective for up to 30 days with the possibility of being renewed.

In that emergency period, it would be illegal for anyone to increase gas or home energy fuel prices to a level that is exploitative or “unconscionably excessive.” 

The proposal would also give the Federal Trade Commission the power to investigate and manage instances of price gouging from larger companies and give state authorities the ability to enforce price-gouging violations in civil courts.

The bill, which has already seen widespread opposition from Republicans and extensive lobbying from pro-oil interest groups, faces an uphill battle in the 50-50 split Senate.

During debate on the act Thursday, Rep. Porter delivered an impassioned speech accusing oil companies of driving their record profits by using their market power to unfairly increase prices.

“The oil and gas industry currently has more than 9,000 permits to drill for oil on federal land, but they are deliberately keeping production low to please their investors and increase their short-term profits,” she said. “Even when the price of crude oil falls, oil and gas companies have refused to pass those savings on to consumers.”

“Let me be clear: price gouging is anti-capitalist,” Porter continued. “It exploits a lack of competition, which is a hallmark of capitalism. It is an effort to juice corporate profits at the expense of customers. Energy markets are reeling because of Russia’s invasion of Ukraine. Big oil companies, however, are using this temporary chaos to cover up their abuse.”

See what others are saying: (The Washington Post) (Vox) (NPR)

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Lincoln College to Close for Good After COVID and Ransomware Attack Ruin Finances

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Last year, 1,043 schools in the U.S. were the victim of ransomware attacks, including 26 colleges or universities, according to an analysis by Emsisoft.


One of the Only Historically Black Colleges in the Midwest Goes Down

After 157 years of educating mostly Black students in Illinois, Lincoln College will close its doors for good on Friday.

The college made the announcement last month, citing financial troubles caused by the coronavirus pandemic and a ransomware attack in December.

Enrollment dropped during the pandemic and the administration had to make costly investments in technology and campus safety measures, according to a statement from the school.

A shrinking endowment put additional pressure on the college’s budget.

The ransomware attack, which the college has said originated from Iran, thwarted admissions activities and hindered access to all institutional data. Systems for recruitment, retention, and fundraising were completely inoperable at a time when the administration needed them most.

In March, the college paid the ransom, which it has said amounted to less than $100,000. But according to Lincoln’s statement, subsequent projections showed enrollment shortfalls so significant the college would need a transformational donation or partnership to make it beyond the present semester.

The college put out a request for $50 million in a last-ditch effort to save itself, but no one came forward to provide it.

A GoFundMe aiming to raise $20 million for the college only collected $2,452 as of Tuesday.

Students and Employees Give a Bittersweet Goodbye

“The loss of history, careers, and a community of students and alumni is immense,” David Gerlach, the college’s president, said in a statement.

Lincoln counts nearly 1,000 enrolled students, and those who did not graduate this spring will leave the institution without degrees.

Gerlach has said that 22 colleges have worked with Lincoln to accept the remaining students, including their credits, tuition prices, and residency requirements.

“I was shocked and saddened by that news because of me being a freshman, so now I have to find someplace for me to go,” one student told WMBD News after the closure was announced.

When a group of students confronted Gerlach at his office about the closure, he responded with an emotional speech.

“I have been fighting hard to save this place,” he said. “But resources are resources. We’ve done everything we possibly could.”

On April 30, alumni were invited back to the campus to revisit the highlights of their college years before the institution closed.

On Saturday, the college held its final graduation ceremony, where over 200 students accepted their diplomas and Quentin Brackenridge performed the Lincoln Alma Mater.

Last year, 1,043 schools in the U.S. were the victim of ransomware attacks, including 26 colleges or universities, according to an analysis by Emsisoft.

See what others are saying: (The New York Times) (Herald Review) (CNN)

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