Wednesday, April 04, 2007

Breaking News: Columbia Financial Aid Dean Invested in Loan Stock

From the New America Foundation's Higher Ed Watch blog, referred to me by an alert reader--

"...Several financial aid administrators who had significant personal investments in a publicly traded, for-profit student loan company. Following a request for university comment, an implicated Dean [at Columbia] was placed on leave by his parent institution.

According to a September 2003 SEC filing by Education Lending Group (see chart on page 18), the original owner of the lender Student Loan Xpress, financial aid directors at Columbia University, the University of Southern California, and the University of Texas at Austin, were preparing to sell 10,500 shares of stock in the company, which were worth more than $100,000 at the time.

The three college aid officials -- Lawrence Burt of University of Texas at Austin, David Charlow of Columbia University, and Catherine Thomas of University of Southern California -- sit on an advisory board that provides strategic advice for Student Loan Xpress. According to sources familiar with the company, the owners of Student Loan Xpress offered stock options as a way to compensate members of that board. Some aid administrators on the board reportedly turned down the offer, citing ethical concerns."

These 3, apparently, had no such concerns. Cuomo's on the case with fresh subpoenas.


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