Does anyone else get the feeling that The Daily Texan student reporters are having a ball covering the University of Texas Office of Student Financial Services scandal?
In its latest article on the scandal, the Texan reports that the financial services office rated student-loan firms based on “treats” and other meals provided to university officials. In internal reviews of their lists of lenders that were recommended to students, UT financial-aid officials rated the loan companies based on a number of criteria, including “visibility,” which was defined as “based on the number of lunches, breakfasts and extracurricular functions for entire OSFS staff.” One document titled “Lender Treats” listed a “Hula Hut Happy Hour” provided by one lender and a lasagna lunch contributed by another.
Last month, UT put Lawrence Burt, its associate vice president and director of student financial aid, on paid leave after it was reported that he owned an interest in the former parent of Student Loan Xpress Inc. (now a unit of CIT Group). For his part, Burt has stated publicly that his interest in the company had nothing to do with UT funneling student loan business to the company. And, yes, Student Loan Xpress Inc. was rated “very good” in free meals and functions in a recent financial services office review.
The UT investigation comes in the wake of a larger investigation by the new Lord of Regulation, New York Attorney General Andrew Cuomo, who announced earlier in the week that six more universities have agreed to settle deceptive-trade-practice claims involving undisclosed payments from firms on preferred-lender lists. A half-dozen or so financial aid officials remain under investigation for taking payments from student loan firms.
My goodness, all this over some lasagna and happy hours? If Cuomo and the institutions were interested in really taking on some real corruption on college campuses, then they would be doing something about this.