For some college officials, money has become more important than helping students, as loan providers take advantage of the financial aid system and ““ even worse ““ the Department of Education passively looks the other way.
The controversy erupted in spring when Columbia University officials, as well as officials from six other institutions, were found to receive benefits from loan companies for encouraging students to borrow from specific lenders. For instance, an investigation at Johns Hopkins University discovered Ellen Frishberg, a former financial aid director, accepted $133,695 from eight different loan providers.
The lenders “approved” by the school only had to pass the test of being the most generous with their funds to officials ““ not their students.
Investigations by Congress, led by New York State Attorney General Andrew M. Cuomo, uncovered extended corruption, yet in the few months since this information has been revealed, the department inspector general told Congress that it had made only “minimal” progress in dealing with the situation.
Minimal progress? A few months have passed and universities should be feeling the heat.
A thorough cleanup of the financial aid system should have been executed by this time, especially before school begins again and students are pushed into loan contracts by college officials ““ officials who don’t have their students’ best interests in mind, but rather, the thickness of their billfold.
There shouldn’t be any problem to begin with because there have been laws against offering inducements, yet the federal government failed to enforce its regulations. And its failings will only snowball if it refuses to solve this problem now.
In addition, the department has refused to address private loan companies, proposing regulations that would only regulate federally guaranteed loans. The private loan companies will have to restrict themselves.
According to a New York Times article, the Department of Education believes private loan companies will enforce integrity in their own industry, revealing the department’s naivete. Yet, in the recent past, they have easily set morals aside for financial gain in this $85 billion dollar loan industry. How long will it take for the Department of Education to enforce these regulations to make a difference in the system they have so poorly constructed?
Financial aid is one of the most important factors in determining how possible it is for a student to have a college experience. No one wants to be working 40 hours a week to scrimp and save for an education when the federal government could be stepping up to the plate and addressing these concerns and making the system more student-friendly.
The Department of Education exists for the benefit of students; the loan companies exist to help students make their college dreams a reality. The constant conflicts of interest between loan companies and universities and the lack of action by the federal government minimize the needs of students.
Students should feel like the FAFSA is their friend and not a convoluted maze just trying to screw them over. Students should not have to pull their hair out because they haven’t received money from the government, and college officials should not be rolling in mounds of money when the people they are working for ““ the students ““ are struggling to make ends meet.
I understand bureaucratic red tape has caused some kinks in the Department of Education.
It could be a lack of funding or manpower. It could be that the priorities of the department are skewed or that the fissures in the system have finally cracked open.
But this inefficiency needs to be eradicated, especially before a new group of students is duped by the complicated financial aid system.
Do you need money? E-mail Bissell at abissell@media.ucla.edu. Send general comments to viewpoint@media.ucla.edu.