Efforts of the U.S. Department of Education to verify data submitted by applicants to the Pell Grant program were analyzed by the General Accounting Office. The effects of carrying out the Department's policy or methodology, called "validation," on financial aid applicants and colleges were assessed. Costs of 1982-1983 validation on schools were evaluated through in-depth case studies of a representative sample of 12 schools. Additional analyses involved: a national mail survey of financial aid officers at a stratified random sample of 400 colleges; a mail survey of students at 3 types of schools selected from the 12 in the case studies; review of the Department's recent studies of Pell error; and interviews with federal officials and representatives of private groups. In 1982-1983 the Department increased to 1.66 million the number of applicants who must validate their eligibility. The estimated cost to colleges was less than 1 percent of the total Pell program, which provided $2.4 billion in grants during the year. The Department's studies identify continuing problems with award accuracy and the error is sizable. Recommendations to improve the Department's policies and procedures are offered. Appendices include information on the research design and methodology. (SW)