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Federal Student Financial Aid Penalties for Drug and Fraud Law Violations

Drug or Fraud Convictions

Drug Offenses

In general, if you are convicted of a drug-related felony or misdemeanor that took place while you were receiving Federal student aid, you will become ineligible to receive further aid for a specified period of time upon conviction.

You can shorten this period of ineligibility by:

    • Successfully completing an approved drug rehabilitation program that includes passing two unannounced drug tests, or 
    • Passing two unannounced drug tests administered by an approved drug rehabilitation program, or 
    • Having the conviction reversed, set aside, or otherwise rendered invalid.

The length of time you are ineligible depends on the type and number of convictions you have had for drug-related offenses committed while you were receiving aid. The law recognizes two broad categories of drug offense: “possession of illegal drugs” and “sale of illegal drugs.” The table below lists the period of ineligibility by type and number of offenses.

Drug Violation Penalties
Offense Possession of Illegal Drugs Sale of Illegal Drugs
First 1 year of ineligibility from date of conviction 2 years of ineligibility from date of conviction
Second 2 years of ineligibility from date of conviction Indefinite period of ineligibility*
Third or more Indefinite period of ineligibility* Indefinite period of ineligibility*
*Under the law, an indefinite period of ineligibility continues unless your conviction is overturned or otherwise rendered invalid or you meet one of the two early reinstatement requirements specified above.

If you do not wish to pursue early reinstatement of your eligibility for Federal student aid, you can calculate the date at which you would regain eligibility for Federal student assistance by completing the Student Aid Eligibility Worksheet, available at:

https://studentaid.ed.gov/sites/default/files/2014-15-student-aid-eligibility-drug-worksheet.pdf

If you have been convicted of a drug offense while receiving Title IV federal financial aid, you must report it on the FAFSA. For additional information on this requirement call a federal representative at 1-800-433-3243.

Find more information on this topic in a fact sheet called “FAFSA Facts for Students with Drug-related Convictions.”

Title IV Fraud

Students who have been convicted of or who have pled nolo contendere or guilty to a crime involving fraud in obtaining Title IV federal financial aid are not eligible for additional federal aid until they have repaid the fraudulently obtained funds.