Transcript for Are wealthy parents giving up guardianship so their kids can claim financial aid?
And now to the new report about what some consider another college admissions scandal. Some parents are apparently using a loophole to get their kids more financial aid, exploiting the system for those that actually need help paying for school. Linsey Davis has With college tuition on average costing about $32,000 a year some are now wondering if paying for college has become so expensive that even wealthy families are having a hard time paying for it and some are resorting this financial aid loophole that allows them to get money they wouldn't otherwise qualify for by transferring legal guardianship of their teens. This morning the education department and several universities are investigating a financial aid loophole that allows children of allegedly wealthy parents to receive financial aid. Parents reportedly give up legal guardianship of their children during their junior or senior year of high school so when their child fills out the application for financial aid the student is able to declare themselves as financially independent, meaning only the child's earnings are considered. The family's income and savings excluded. What's first come first serve so if there are students who are taking these moneys who really don't need it, they are really taking it away from families who are in great need. Reporter: Investigations by "The Wall Street journal" and propublica Illinois uncovered dozens of such cases in the suburban Chicago area with some of those families living in half million or million dollar homes. It definitely is not illegal but I think it definitely is unethical and I think one of the unfortunate things is whenever instances like this occur there's always kind of an effort to say, well, we should tighten this up and restrict the process and if that ends up happening I think the real losers will be the needy families because then they'll be forced to prove they're not gaming the system. Now, one mother whose household income is $200,000 a year, she admitted to "The wall Street journal" she gave up guardianship of her 17-year-old daughter because they had already spent $600,000 sending their other kids to college and simply didn't have enough money saved to send this one on to college without some help. While this strategy is not illegal many are questioning just how ethical it is. Certainly something we'll keep hearing a lot about. Tuition prices are skyrocketing. All right, linsey, thank you very much.
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