Colleges and universities around the region said they are not being targeted in an investigation by New York Attorney General Andrew Cuomo into potential conflicts of interests with private lenders who provide student loans.
Cuomo sent letters to every private lender in New York state, as well as a number of colleges and universities around the country, warning them to disclose any ties they had with private student loan providers. He said an investigation of industry practices revealed universities had inappropriate relationships with lenders placed on their “preferred list” — a list of lenders provided by financial aid offices.
According to the attorney general, some universities have revenue sharing agreements with lenders and push students towards borrowing with them.
“There is an unholy alliance between banks and institutions of higher education that may often not be in the students’ best interest,” Cuomo said in a statement released last week. “The financial arrangements between lenders and these schools are filled with the potential for conflicts of interest. In some cases they may break the law.”
Officials from Georgetown, George Washington and the University of Maryland College Park said they did not receive the letter. A spokeswoman for American University said she was unaware that the university received any letter from Cuomo. Catholic University did not return phone calls. In Virginia,an official from William and Mary said it did not receive Cuomo’s warning. Calls to the University of Virginia, Virginia Tech and George Mason were not returned.
