There is one thing that is certain about being a college student, we rely and trust that faculty and staff will help guide us through the process. Recently there has been news that colleges have broken that trust.
New York Attorney General Andrew Cuomo has been putting pressure on colleges for receiving gifts from lenders in order to be put a preferred list for students.
CNN reports that investigators working for Cuomo found numerous arrangements that benefited schools and lenders at the expense of students. Some lenders gave all-expense paid vacations to college financial aid officers who directed students to the lenders.
As a New York college student this information is shocking. The process of being able to be a lender for students should be based on the most competitive offer not who can offer the best exotic trip. The world is full of people looking to make a profit.
Cuomo has created a code of conduct for the schools to abide by. Some of the colleges that agreed are New York University, St. John’s University, University of Pennsylvania and Fordham University. Although they all agreed, none of them admits any wrongdoing.
The code bans lenders from giving gifts in exchange for an advantage in landing loan business. Also college officials will be prohibited from receiving compensation for serving on advisory boards at private loan companies, Cuomo said.
Most importantly schools must make it clear to students the criteria used to place lenders on their preferred list and advise students that lenders not on the list are also options to go with.
This story hit close to home. My school, Pace University, was among the schools that were being looked at. I have taken government student loans to help pay for college. I was looking to get a private lender to pay for the remainder, but decided it would be cheaper for me to pay it on my own.
Pace contracted with lender Sallie Mae to provide employees to staff financial aid call centers who identified themselves as Pace University employees, Cuomo said.
In a statement Pace said that it didn’t participate in any revenue sharing. They also changed protocol to make it clear that Sallie Mae personnel would be working on behalf of the University according to CNN.
To read the letter sent to Pace University students click here.
Related Articles:
Settlement reached in NY student loan probe [CNN]
Colleges settle, others may be sued [CNN]
New York Attorney General Andrew Cuomo has been putting pressure on colleges for receiving gifts from lenders in order to be put a preferred list for students.
CNN reports that investigators working for Cuomo found numerous arrangements that benefited schools and lenders at the expense of students. Some lenders gave all-expense paid vacations to college financial aid officers who directed students to the lenders.
As a New York college student this information is shocking. The process of being able to be a lender for students should be based on the most competitive offer not who can offer the best exotic trip. The world is full of people looking to make a profit.
Cuomo has created a code of conduct for the schools to abide by. Some of the colleges that agreed are New York University, St. John’s University, University of Pennsylvania and Fordham University. Although they all agreed, none of them admits any wrongdoing.
The code bans lenders from giving gifts in exchange for an advantage in landing loan business. Also college officials will be prohibited from receiving compensation for serving on advisory boards at private loan companies, Cuomo said.
Most importantly schools must make it clear to students the criteria used to place lenders on their preferred list and advise students that lenders not on the list are also options to go with.
This story hit close to home. My school, Pace University, was among the schools that were being looked at. I have taken government student loans to help pay for college. I was looking to get a private lender to pay for the remainder, but decided it would be cheaper for me to pay it on my own.
Pace contracted with lender Sallie Mae to provide employees to staff financial aid call centers who identified themselves as Pace University employees, Cuomo said.
In a statement Pace said that it didn’t participate in any revenue sharing. They also changed protocol to make it clear that Sallie Mae personnel would be working on behalf of the University according to CNN.
To read the letter sent to Pace University students click here.
Related Articles:
Settlement reached in NY student loan probe [CNN]
Colleges settle, others may be sued [CNN]
Picture Courtesy of wfsb.com
