I found this information to be interesting - I know a lot of rules and regulations are required for any government-related money, and I'm glad we have an office that keeps up with these things. As a faculty member it's way over my head. However, for my part, I would not exaggerate or be dishonest in any way with a student or prospective student. If I am involved in interviewing a student and/or checking on their qualifications, I always intend to be very honest about whether the prospect understands the work that is required and has the knowledge and ability to complete the program. Sometimes it just isn't the right time in a person's life to attend school, no matter how much they want to. Although each one ought to have the chance to further their education, it is not doing them a favor to encourage them if it is clear there are significant barriers they need to overcome before they begin a program. The barrier might be poor academic preparation, financial constraints, family and/or job demands or any number of other things. This all should be brought up before a student enrolls and/or accepts financial aid.