My sister and niece may have forged mom's name on government school loans. What should I do?

Government loans applied for by filling out the FAFSA, which requires much information about the parents' financial situation, is never the parent's responsibility to repay. The government loans are always the student's debt. If you don't believe me (and I sent 3 girls to college on FAFSA loans) google it.

Now private loans, I don't know about. Fortunately we never had to do those.

I suspect your niece needs to prove need and that she is not going to receive money from a trust fund or other means. The government looks at need when awarding these loans.

ps - I don't know what your sister thinks you DON'T know about University loans, but I will tell you that one of my dearest friends co-signed to student loan for her granddaughter. The granddaughter was working part time, she injured herself on the job, wasn't able to continue school and her loan came due. But she was out on disability so not earning income and guess who is getting the phone calls about paying the bill? Right, grandma the cosigner. I help my friend with her finances and know the family so it was up to me to call granddaughter. I did it AFTER I called the school and got the details on loan. G/d give me some mumbo jumbo about never being able to get through to them and having to wait on hold for hours when I got through with my first call. She told me they were supposed to put the loan on hold because of her medical problems. Ok, fine, I said, but they're bugging your 85 year old grandmother and she's already made several payments in fear of her own credit report. Then I talked to the dad, my friends son, who had been unaware of the problem. He took care of it post haste, it got straightened out and its never happened since. But if your sister thinks there's no consequences to defaulting on a student loan, she's just W-w-wrong ! We got it corrected but the late payments of the granddaughter showed up as dings on my friends credit report. You betcha!

Make sure you get documentation of that message! You may be able to download it from your carrier or request it.

You know, it's easy for an outsider to recommend bringing down the wrath of god and all the legal bells and whistles against someone but you have approach this on a good middle ground. You don't want to outrightly damage your niece when you know this was instigated by your sister. What a shame. And based on her email response to you, you can certainly know where that comes from. What a piece of work she is...WHOA ! !

I actually pulled a credit report on my mother and an inquiry was made by Educational Services. I have contacted my mothers trust attorney to determine if there were other steps I could take to make sure the trust is not compromised in the event she defaults on the loans. I do not want to destroy my nieces education or future. Even though my niece is an adult and made the phone call requesting this information from my mother, my sister definetly had her hand in this. I wrote a nice (non-threatening) text message to niece and told her what my responsibilities were as trustor and POA and even though my father co-signed for the original loan that if it meant her education or my mothers well-being, he would choose my mother hands down ever time. I told her I was going to contact the attorney and take his recommendations under advisement, but also told her I wasn't looking to destroy her education or future. The thing is if she would have called me I probably would have co-signed myself. I never recieved a response from her, what I got was a message from my sister that went like this "Ya you need to go get some advise..as I'm cracking up @ you wasting your time!!! I would save you a trip on getting that advice, but I would rather shake my head and laugh...apparently you know NOTHING about University Loans!!! Please to all my sisters...we are out of your lives..get out of our business!!! God don't like ugly!! I can be a b&*(&%!! lol." See what Im dealing with???... Thank You all for your comments, you don't know how much you've helped.

The privacy "stuff" is moot when one has a POA, and I only suggested to see the signature.

Not sure what you mean ferris1 about who would be held liable; the original post does not want to cause more trouble than already is going on since the father's death. I agree some one needs to investigate; not sure the school would cooperate due to all this privacy stuff these days; it is not pleasant to have a situation with siblings; the bottom line is protection for the mother's assets so there is $ to take care of her and for that no apologies/explanations are necessary to anyone; if there is fraud, it has to be dealt with. Does Mother know what the problems might be?

I've got news for you, it could be held liable unless you can prove a forgery took place. I suggest you go to your niece's school, show them your LEGAL documents and ask to see the signature for verification. If your niece did something illegal, she will be held responsible and can be put in jail. Defrauding on a student loan is no laughing matter with penalties in the thousands, plus restitution. Any monies gotten by ill means may have to be paid back three times what the loan was, so this is serious. So what if it causes trouble? You are teaching your sister and her daughter they cannot break the law. Do it!

In spite of my post, I agree completely with butterfly that it should go without saying that further investigation into any sleezy activity should be made. If you discover they have done other things not related to the student loan, of which you felt your dad approved, all bets would be off in my book and criminal investigation should be pursued. At that point, "no more ms. nice guy".

All good posts - one additional thing - suppose you get the letters signed that the loan will come out of your sister's inheritance - what if they've done other things with that ID info and the estate becomes 0 and there will be nothing left to take care of Mom; you do need to investigate or talk with them if possible; I know that is not always easy. My brother reduced my parents' estate by thousands of $'s with a notary who helped "draw my father's signature" on the new POA document, all fraud and criminal and we could not stop it. He would have inherited their home too, if Dad had not passed when he did. You have to be careful; siblings do unkind things to each other when there is money involved and it beats me why it has to be that way. We all had the same parents, but we sure are different as adults, and our parents would be very sad at the outcome of their childrens' relationships now. Bless you for taking such good care of your Mom; you will never be sorry, but don't let this go on too long before you find out what is going on or there may be nothing left for her expenses. xxxooo

You need more information. So far you only suspect what they've done. If they've done what you now suspect, don't worry about what the family might think. The people who did this, didn't care. You are there to protect your mother, her interest come first.

If, as you say, you don't want to cause more family issues, then "alwayslearning" (gr8 user ID for a responder to this educational topic, haha) has given you a viable solution.

If your dad was willing to help with a student loan for your niece, his granddaughter, probably your mother would have been happy to do the same. The problem isn't THAT they did it (if they did) BUT the SNEAKY WAY they did it (again, if they did).

As POA, you should call a family conference and get it out on the table what you think they get because of asking for your moms ID. If they cop to doing it, you can tell them that they are going to have to sign papers independent of the loan saying that (1) your sister will be personally responsible for any default and (2) if there are any default but she cannot or will not cover, search amount would be deducted from her eventual inheritance. If they balk at this, you tell them that's what they must do to avoid you starting a fraud investigation. If your sister is married, her husband needs to be included in the meeting and I'm thinking his signature should probably be on the documents about the inheritance. Even if he chooses for you to add wording holding him harmless for what they did.

If they assure you they didn't do what you suspect, you should tell them you are going to investigate and once you start the process you won't be able to stop it, so are they sure?

You might want to consult an attorney to see if my ideas would work. If you decide to do that, I would expect your sister to pay the unless you turn out to be mistaken, of course, which is a possibility.

I wouldn't vote (if l get one) to get your family in trouble criminally if it can be avoided.

IF you are certain that that your mothers name was forged. I'd confront them with what you know. If they do not rectify the matter then you have basically only one logical choice and that is to turn "them" into the authorities. If you do not turn them then you could be considered an accessory and be arrested also.

Hang on, there may be a way to handle this that doesn't destroy your niece's educational future. Besides, you are only speculating that this is what they've done. Furthermore, if some of your mother's estate is to be inherited by your sister, the executor would take any portion due to student loans out of that inheritance. If your family were communicating well, you all might have figured this out in advance in such a way that it was ok. Right now you haven't been communicating well, and it has resulted in their maybe taking an action you wouldn't like, and without your knowing about it. Now it's your move in family dynamic: if you go from suspecting that your sister and niece have used your mom's name on a student loan application to calling in a fraud report on them, without even talking to them about it, the family issues will certainly get worse. This is how bad situations often get worse -- assuming that the situation is dysfunctional, we act in ways that fan the flames. Ask yourself, "suppose this family were more functional, what would we be doing?" And see how close you can get to taking those actions. Perhaps you can actually turn the spiral around to where communication works better in the future. "I'm worried about this" is a start, rather than "I am certain you are behaving fraudulently and I'm calling the authorities on you!" There's time for that if you really must get to that point, but starting there only guarantees you get to it right away.

IF the student loan was through Sallie Mae, they usually require a telephone confirmation w/the grandparent to make sure the grandparent KNOWS about the student loan. This way Sallie Mae has voice confirmation of the loan securer. They tape all conversations. Was this done?? You may want to contact Sallie Mae (if they are the loan holder) and explain the situation. They've dealt w/ this issue before so don't be embarrassed to call. There will be a fraud investigation and your neice's loan could be revoked. This may cause more family issues BUT you have to do what is right for your mother. Don't be bullied by family members who only care about money and not the person. Good luck.

Is your sis and neice went the traditional route of FAFSA this may be easy to stop. They probably did because of the info they requested. Call FAFSA, explain the situation and ask them to stop any planned disbursements. Any that have been made already can be called back from the school.

I have a hard time understanding the gall of some people. And the fraud carried out by some family members on other unsuspecting family members is absolutely appalling. It has also happened within my family.

The fraud alert is an excellent first step! Definitely do that right away! You can also contact the school and inform them that if your Mother's name is on the financial aid application for said student, that you have your Mom's legal POA (not medical, they are two totally different documents and both require a lawyer to draw them up) and therefore your Mom was not able to sign any legal document because of dementia, alzheimer's, etc. The school will have to check into it when you tell them that your Mother will not be held responsible. Since you have POA for your mother, they do have to talk to you if her name was used fraudulently. You can also ask the school not to inform the student as to why the application was looked over, the financial aid program does this on a regular basis. Beware, if your sister and niece are doing this, they may have taken out a credit card in her name as well under the student's name. It rarely stops at one thing.

So sorry you are going through this with your family. I do hope things get better for you.

Go on-line to each of the big 3 credit reporting agencies and file a fraud alert &/or an identity theft report. You need to print out a copy that shows this was done.

If they have done this, then later on when you are dealing with probate and claims or leins on mom's estate, you as executrix can have those claims thrown out using the fraud alert as the basis.