Student Aid Fraud Oversight and Accountability Act of 2026

This Act may be cited as the “Student Aid Fraud Oversight and Accountability Act of 2026”.

(a) Program review priority category.— Section 498A(a)(2) of the Higher Education Act of 1965 (20 U.S.C. 1099c–1(a)(2)) is amended—

(1) in subparagraph (E), by striking “and” at the end;

(2) by redesignating subparagraph (F) as subparagraph (G), and striking “and” after the semicolon at the end of such subparagraph; and

(3) by inserting after subparagraph (E) the following:

“(F) institutions identified under paragraph (4); and”.

(b) Identification of institutions of higher education.— Section 498A(a) of the Higher Education Act of 1965 (20 U.S.C. 1099c–1(a)) is amended—

(1) in paragraph (3), by striking the period at the end and inserting “; and”; and

(2) by adding at the end the following:

“(4) shall identify each institution that has disbursed, on or after October 1, 2026, Federal financial aid under this title for an award year to any student whose application under section 483 for such award year presented a reasonable suspicion of identity fraud, as determined by the identity fraud detection system used by the Secretary, except that the Secretary shall exclude from such identification any institution that demonstrates to the Secretary that, with respect to each such student, before the disbursement of Federal financial aid to the student, the institution, in accordance with procedures established by the Secretary, determined that a reasonable suspicion of identity fraud was not present by confirming the identity of such student using in-person verification or live, synchronous audiovisual verification and notified the Secretary that the identity of the student has been verified, and maintains a record of such identity verification.”.

(c) Special considerations.— Section 498A of the Higher Education Act of 1965 (20 U.S.C. 1099c–1) is further amended by adding at the end the following:

“(f) Special considerations.— Identification of an institution under subsection (a)(4)—

(1) may be used to inform program reviews, audits, investigations, and other oversight activities authorized under this title; and

(2) shall not, by itself, constitute a determination that such institution has failed to meet the requirements of this title.”.