University Suspends Student Organization for Alleged Fraud

Graphic by Michael McDevitt, Photos Courtesy of Natalie Battaglia and @LUCSASA on TwitterThe South Asian Student Alliance was suspended from campus earlier this month after the university discovered the group had allegedly been mismanaging funds and submitting fraudulent reimbursement requests.

Loyola has suspended the South Asian Student Alliance (SASA), the largest cultural student organization on campus, for four years for several violations, including alleged fraud.

The university emailed a sanction notice to SASA’s extensive network of members and alumni Sept. 18, notifying current and former members that the organization was suspended from campus until August 2021 following a university investigation, according to several sources close to the situation, as well as records obtained by The PHOENIX.

The sanction notice listed four violations of Loyola’s Community Standards — fundraising violations, alcohol policy violations, submittal of fraudulent documentation and falsification of university records.

The investigation was conducted throughout the summer by Loyola’s Department of Student Activities and Greek Affairs (SAGA) and Office of Student Conduct and Conflict Resolution (OSCCR). The decision was finalized Sept. 5, according to Tim Love, associate dean of students.

“The university has learned that over the past several years, some SASA officers deceived the university community by submitting false expense reports and fraudulent funding requests to divert money from the Student Activity Fee,” the sanction notice stated.

All money SAGA allocates to various on-campus organizations comes from the Student Activity Fund, a pool of money created from a fee within university tuition every undergraduate student pays that goes toward student organization-sponsored events.

Students and alumni of SASA received this notice of the group’s suspension from Loyola following a university investigation into financial mismanagement on Sept. 18.

SASA is an organization for students to celebrate South Asian culture and traditions and build community with fellow students of South Asian descent through various activities and events. The group was Loyola’s largest cultural organization with more than 200 student members, not including alumni, according to an executive board member of the organization.

Several members of SASA’s executive board were caught abusing flaws in SAGA’s funding system regarding the reimbursement of expenses, according to the sanction notice.

SAGA funds student-sponsored events in two primary ways: credit card payment requests and reimbursement requests. Credit card payment requests require organizations to tell SAGA the cost of an item prior to its purchase so the department can pay for it. Reimbursement requests occur after organizations have made purchases for various events. SAGA describes these policies in detail in its student handbook.

Reimbursement requests essentially rely on an honor system — members present SAGA with a proof of purchase — often a receipt — and SAGA foots the bill.

SASA board members repeatedly gave SAGA receipts for items they’d already returned to the original retailers, according to a former member of the organization who asked to remain unnamed.

Over and over, board members were reimbursed by SAGA for costs for which they’d already been repaid, according to the former member.

The former member said they’d received an email from OSCCR in August asking them to verify a past reimbursement request they’d made as part of an ongoing investigation into the group.

Although that member’s reimbursement request checked out in accordance with SAGA’s policies, a few board members failed.

“The people who were not able to verify their items were clearly in charge of all this scheming,” the source said.

While the amount of money some SASA board members allegedly stole from the university is unclear, along with when the fraud began, the sanction notice from Loyola estimated it was “several thousands of dollars.” The OSCCR email stated the practice had occurred possibly over the past four years.

A former member of the South Asian Student Alliance received this email from OSCCR in August asking them to verify a past reimbursement made in their name.

The former member said the board members responsible could’ve used that money for anything.

“It would be a check from Loyola,” the former member said. “You’re not required to put that in your organization’s revenue account. So you can do whatever you want with it.”

The fraudulent funds were supposedly used to host SASA’s annual formal dance, according to several sources, including the suspension notice sent to members from both SAGA and OSCCR last week.

Additionally, some of that money for the formal was said to have been used inappropriately and in violation of university policy.

“The formal was determined to have been planned and executed without university knowledge or approval and in violation of student organization policies pertaining to fundraising and alcoholic beverages,” the sanction notice said.

An executive board member of SASA, who asked to remain unnamed for this story, said they were aware of the potentially dubious financial dealings during their time on the SASA e-board last year. The board member said they wanted to put a stop to it in their role this year.

“I was planning on ending these practices,” the board member said. “It’s unfortunate it had to end this way.”

The board member emphasized the violations were the result of the actions of a few board members that affected the organization at large.

“It’s been emotionally disheartening and difficult for the executive board and the 200 members as well,” they said. “[SASA] was a large community … Everyone felt at home.”

While this appears to be a case of students allegedly stealing money from Loyola, if true, it would also be a case of fellow students taking money from the student body at large.

“SASA is under investigation for the mismanagement of funds; specifically the embezzlement of the Student Activity Fund (SAF),” the August OSCCR email read.

As stated, the fund is created from a portion of the Student Development Fee that every student pays. For the 2017-18 academic year, that fee was $419 per semester for undergraduates enrolled in more than 12 credit hours at Loyola.

Several top Loyola administrators could not comment on the story.

Love said the university plans on releasing a broad statement later this week regarding a number of issues, unrelated to financial mismanagement, with student organizations in addition to SASA.

Love said the statement is expected to mention Loyola’s chapter of Alpha Kappa Psi, a business fraternity suspended in August for hazing and fundraising violations, and Kapwa Loyola, a Filipino cultural organization on campus that The PHOENIX has now learned has faced some sort of discipline from Loyola.

Love said the university waited to make a statement until SASA’s window to appeal the university decision closed on Sept. 12. He said the university discussed criminal charges for those members found responsible, but ultimately the school chose to resolve the matter within the university conduct system.

Clarification: While the money SASA Board members allegedly stole could’ve been used in any way, the only way confirmed was funding for the SASA formal.

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