Friday, March 30, 2007

Cuomo's Financial Aid Probe Continues

Chronicle says:
"New York State’s attorney general, Andrew M. Cuomo, has sent settlement agreements to dozens of colleges across the country that he has accused of accepting kickbacks from student-loan companies.Colleges in New York State had until noon today to sign the agreements. If they did not, they faced the possibility of being served with subpoenas from Mr. Cuomo’s office. Colleges in other states were reportedly given a later deadline."

The settlement agreements included promises to disclose relationships with preferred lenders, stop taking kickbacks, and tell students they have a right to borrow from anyone, and--get this--a promise to reimburse students who took out private loans.


Anonymous said...

Any chance this guy is on a witch hunt? Seems like he is going a little overboard, and definately outside of his boundries. He clearly states in multip articles that these schools and lenders have done nothing illeagal? Then why bully them with lawsuits? and phony settlements?

He seems as if he doesnt give a damn about students, only about his political career. what are your thoughts?

Anya said...

Hm... your language sounds a little loaded. Could it be you are employed by a lender or related organization?

I think once the full extent of these relationships are revealed, it is up to students and taxpayers to decide how they feel about the system of incentives by which lenders woo schools, and whether they feel they are in the students' best interests. Commissions, tips, and gifts are ok in some industries, not in others.

Anonymous said...

From the look of it, it sounds like Cuomo is taking a cue from the RIAA playbook and sending settlements to parties who he may not have anything more than circumstantial evidence on.

And just what type of kickbacks has he uncovered? Sure, the revenue-sharing issue is a nasty one which does call into question integrity issues, but from what I read in Cuomo's releases, there were a very small number of lenders/institutions involved in that, no?

Anonymous said...

appears if i was wrong in my orginial post, after today's news, it would appear he is actually on to something.
Hard to imagine that Citibank, who i was unaware was even involved in the investigation, would settle a case if there was nothing to it.

do you think these schools and lenders should take the settlements? from both views, should they take the settlement if they did in fact participate in unhealthy relationships that were harmful to students? and also should they if they didn't?

I do not work for a lender, but did work in the financial aid office as a work grant. so yes, my language is a little biased, i apologize.

but i respect your opinion, what are you thoughts on this unfolding circus? there has to be something we the public just doesnt see, schools were given settlement agreements and signed them the same day? would anyone who was innocent ever do that?

Anonymous said...

We should see if we could get a copy of the settlement agreement for a specific school. That could help us figure out what really happened.

It doesn't surprise me that some schools would sign it even if they haven't done anything improper - most institutions don't have the time or funds to fight a legal battle like this - especially those in state where a fight with the AG could have funding repercussions in the legislative branch.

Again - it's very similar to the RIAA quote above - put the pressure on the small fry and they'll buckle rather than fight. Extortion tactics like this are inexcusable - especially for someone who is supposed to be supporting the public interest. What type of example does that send?