Academic progress requirements of federally funded student aid programs administered by the Department of Education (ED), the Veterans Administration (VA), and the Social Security Administration (SSA) were investigated. Eighteen public and private two-year and four-year colleges, as well as one public vocational school and one proprietary school, were visited, and more than 5,800 randomly selected student transcripts were reviewed. It was found that many students receiving financial aid were not making satisfactory progress. Mainly this resulted from school standards that allowed students to remain eligible for aid without proving that they were moving toward a definite goal with adequate grades and at a reasonable rate. Some of the institutions were not even enforcing their own standards. For the schools that had not enforced their standards for ED aid recipients, overpayments were estimated to about $1.28 million. It is concluded that weak and nonspecific federal requirements on academic progress have led to abuse of the student aid programs, particularly those administered by the ED and SSA. It is suggested that ED and SSA requirements should be essentially the same as those set by the VA. It is proposed that regulations are needed that specify that an institution establish, publish, and enforce academic progress standards for students receiving aid. The standards should address the movement toward graduation at a reasonable rate and with adequate grades, and limitations on excessive withdrawals and courses that do not count toward graduation or program completion. Additional recommendations to Congress and the federal agencies are included. (SW)