There's a new college scam in Illinois and this one's perfectly legal (for now).
On Monday, both The Wall Street Journal and ProPublica reported that dozens of rich Illinois parents have transferred guardianship of their teenage kids to friends, business associates or neighbors so they can qualify for need-based financial aid.
The scam works like so: Citing some sort of household disturbance that makes caring for a teen difficult, their custodial rights are transferred to someone else. Once that happens, the kids use their own income--usually from a low-wage summer job--instead of their parents' to secure financial assistance from colleges.
One Chicago-area woman with a household income of more than $250,000 told The Journal that once she transferred guardianship of her teenage daughter to a business associate, the teen only had to claim the $4,200 she earned through her summer job.
Hence, she now attends a private West Coast college with an annual of tuition of $65,000--$47,000 of which is subsidized through grants and financial aid.