Millions to Be Repaid After College Loan Inquiry
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By JONATHAN D. GLATER
Published: April 3, 2007
Citibank, one of the largest providers of student loans, as well as five universities have agreed to pay $5.2 million to students and the New York State attorney general to resolve an investigation into student loan practices, Andrew M. Cuomo, the attorney general, announced yesterday.
Citibank, which at year’s end had $33.7 billion in student loans outstanding, agreed to pay $2 million into a fund to educate students and parents about student loans.
New York University, Syracuse, St. John’s and Fordham — all in New York — and the University of Pennsylvania will make payments of more than $3.2 million to student borrowers who received loans from companies that paid money to the institutions to steer students their way.
Though neither Citibank nor the universities admitted to any wrongdoing, they all agreed to adopt a code of conduct governing relations between student lenders and academic institutions. St. Lawrence University and Long Island University as well as the State University of New York also agreed to the code.
The agreements follow an investigation into the often undisclosed relationships between student loan companies and universities that often create preferred lender lists. In 2006, students borrowed about $85 billion, according to the College Board.
Mr. Cuomo has singled out in particular a practice he called “egregious,” in which loan companies give universities back payments that rise along with the volume of private student loans from the schools. Private loans are not secured by the federal government.
Lenders have also invited university officials on expense-paid retreats. And at several institutions, call centers operated by loan companies handle student questions about financial aid. Each arrangement, critics say, creates an incentive to steer students toward particular lenders regardless of the loan terms they are offering.
The National Association of Student Financial Aid Administrators issued a statement accusing the attorney general of tearing “the fabric of trust between schools and students” and adding “any preferred lender list abuses and genuine conflicts of interest should end, however such abuses are rare.”
Lawyers in Mr. Cuomo’s office are in negotiations with about 60 additional academic institutions and with other loan companies. Mr. Cuomo has announced his intention to sue one loan company, Education Finance Partners of San Francisco, for deceptive business practices in paying colleges based on private student loan volume.
Under the agreement, New York University will set aside nearly $1.4 million, or all that it received over a five-year period from Citibank, to be distributed to students who took out a loan during that time. In two other cases involving Citibank, the University of Pennsylvania will repay $1.6 million received over two years and Syracuse will pay back $164,084 received over three years.
In cases involving Education Finance Partners, St. John’s University will pay $80,553 and Fordham will pay $13,840.
Under the code of conduct agreed to by the eight institutions and Citibank, universities and their employees are prohibited from receiving “anything of value from any lending institution in exchange for any advantage,” the attorney general’s office said, and would have to disclose the criteria used to select preferred lenders.
Citibank, in a statement, said it had participated “only modestly or not at all” in most of the practices singled out by Mr. Cuomo’s office. The company, which makes loans at about 3,000 colleges, said that students at colleges that received payments had “received the best terms, benefits and servicing available.”
The universities’ payments to students will vary with the amount each student borrowed. At the University of Pennsylvania, the compensation fund will pay an average of $500 per student, university officials said. Craig R. Carnaroli, the executive vice president, said the decision to settle was made “to avoid any appearance of impropriety.”
John Beckman, a spokesman for N.Y.U., defended the university’s payments from Citibank. The university used the money to provide additional financial aid to its students, Mr. Beckman said.
“While we and the attorney general’s office do not see eye-to-eye on this, we were able to agree on an industry-wide code of conduct,” Mr. Beckman said in a statement.
At Syracuse, the vice president of enrollment management, David C. Smith, said the university had done nothing wrong but added that there was insufficient regulation of student lending.
Dominic Scianna, director of media relations at St. John’s University, defended the institution’s recommendation of Education Finance Partners as a preferred lender. “The company is one of three St. John’s preferred lenders,” Mr. Scianna said, “each of which was selected for having among the lowest rates in the country, no fees and historically the best service to students.”
Fordham stopped accepting payments from Education Finance Partners after just one year, the university said.
Tuesday, April 3, 2007
Tuesday, February 27, 2007
Sorority Evictions Raise Issue of Looks and Bias
GREENCASTLE, Ind. — When a psychology professor at DePauw University here surveyed students, they described one sorority as a group of “daddy’s little princesses” and another as “offbeat hippies.” The sisters of Delta Zeta were seen as “socially awkward.”
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Andrew Hancock for The New York Times
Women at DePauw University in Indiana who were either asked to leave the Delta Zeta house or resigned in protest hold a sorority photo.
Enlarge This Image
Andrew Hancock for The New York Times
Elizabeth Haneline, who was among those evicted, said, “The Greek system hasn’t changed at all, but instead of racism, it’s image now.”
Worried that a negative stereotype of the sorority was contributing to a decline in membership that had left its Greek-columned house here half empty, Delta Zeta’s national officers interviewed 35 DePauw members in November, quizzing them about their dedication to recruitment. They judged 23 of the women insufficiently committed and later told them to vacate the sorority house.
The 23 members included every woman who was overweight. They also included the only black, Korean and Vietnamese members. The dozen students allowed to stay were slender and popular with fraternity men — conventionally pretty women the sorority hoped could attract new recruits. Six of the 12 were so infuriated they quit.
“Virtually everyone who didn’t fit a certain sorority member archetype was told to leave,” said Kate Holloway, a senior who withdrew from the chapter during its reorganization.
“I sensed the disrespect with which this was to be carried out and got fed up,” Ms. Holloway added. “I didn’t have room in my life for these women to come in and tell my sisters of three years that they weren’t needed.”
Ms. Holloway is not the only angry one. The reorganization has left a messy aftermath of recrimination and tears on this rural campus of 2,400 students, 50 miles southwest of Indianapolis.
The mass eviction battered the self-esteem of many of the former sorority members, and some withdrew from classes in depression. There have been student protests, outraged letters from alumni and parents, and a faculty petition calling the sorority’s action unethical.
DePauw’s president, Robert G. Bottoms, issued a two-page letter of reprimand to the sorority. In an interview in his office, Dr. Bottoms said he had been stunned by the sorority’s insensitivity.
“I had no hint they were going to disrupt the chapter with a membership reduction of this proportion in the middle of the year,” he said. “It’s been very upsetting.”
The president of Delta Zeta, which has its headquarters in Oxford, Ohio, and its other national officers declined to be interviewed. Responding by e-mail to questions, Cynthia Winslow Menges, the executive director, said the sorority had not evicted the 23 women, even though the national officers sent those women form letters that said: “The membership review team has recommended you for alumna status. Chapter members receiving alumnae status should plan to relocate from the chapter house no later than Jan. 29, 2007.”
Ms. Menges asserted that the women themselves had, in effect, made their own decisions to leave by demonstrating a lack of commitment to meet recruitment goals. The sorority paid each woman who left $300 to cover the difference between sorority and campus housing.
The sorority “is saddened that the isolated incident at DePauw has been mischaracterized,” Ms. Menges wrote. Asked for clarification, the sorority’s public relations representative e-mailed a statement saying its actions were aimed at the “enrichment of student life at DePauw.”
This is not the first time that the DePauw chapter of Delta Zeta has stirred controversy. In 1982, it attracted national attention when a black student was not allowed to join, provoking accusations of racial discrimination.
Earlier this month, an Alabama lawyer and several other DePauw alumni who graduated in 1970 described in a letter to The DePauw, the student newspaper, how Delta Zeta’s national leadership had tried unsuccessfully to block a young woman with a black father and a white mother from joining its DePauw chapter in 1967.
Despite those incidents, the chapter appears to have been home to a diverse community over the years, partly because it has attracted brainy women, including many science and math majors, as well as talented disabled women, without focusing as exclusively as some sororities on potential recruits’ sex appeal, former sorority members said.
“I had a sister I could go to a bar with if I had boy problems,” said Erin Swisshelm, a junior biochemistry major who withdrew from the sorority in October. “I had a sister I could talk about religion with. I had a sister I could be nerdy about science with. That’s why I liked Delta Zeta, because I had all these amazing women around me.”
Skip to next paragraph
Enlarge This Image
Andrew Hancock for The New York Times
Rachel Pappas, former chapter secretary, discussing the events in class. At a rally, she said national leaders had misrepresented the truth.
But over the years DePauw students had attached a negative stereotype to the chapter, as evidenced by the survey that Pam Propsom, a psychology professor, conducts each year in her class. That image had hurt recruitment, and the national officers had repeatedly warned the chapter that unless its membership increased, the chapter could close.
At the start of the fall term the national office was especially determined to raise recruitment because 2009 is the 100th anniversary of the DePauw chapter’s founding. In September, Ms. Menges and Kathi Heatherly, a national vice president of the sorority, visited the chapter to announce a reorganization plan they said would include an interview with each woman about her commitment. The women were urged to look their best for the interviews.
The tone left four women so unsettled that they withdrew from the chapter almost immediately.
Robin Lamkin, a junior who is an editor at The DePauw and was one of the 23 women evicted, said many of her sisters bought new outfits and modeled them for each other before the interviews. Many women declared their willingness to recruit diligently, Ms. Lamkin said.
A few days after the interviews, national representatives took over the house to hold a recruiting event. They asked most members to stay upstairs in their rooms. To welcome freshmen downstairs, they assembled a team that included several of the women eventually asked to stay in the sorority, along with some slender women invited from the sorority’s chapter at Indiana University, Ms. Holloway said.
“They had these unassuming freshman girls downstairs with these plastic women from Indiana University, and 25 of my sisters hiding upstairs,” she said. “It was so fake, so completely dehumanized. I said, ‘This calls for a little joke.’ ”
Ms. Holloway put on a wig and some John Lennon rose-colored glasses, burst through the front door and skipped around singing, “Ooooh! Delta Zeta!” and other chants.
The face of one of the national representatives, she recalled, “was like I’d run over her puppy with my car.”
The national representatives announced their decisions in the form letters, delivered on Dec. 2, which said that Delta Zeta intended to increase membership to 95 by the 2009 anniversary, and that it would recruit using a “core group of women.”
Elizabeth Haneline, a senior computer science major who was among those evicted, returned to the house that afternoon and found some women in tears. Even the chapter’s president had been kicked out, Ms. Haneline said, while “other women who had done almost nothing for the chapter were asked to stay.”
Six of the 12 women who were asked to stay left the sorority, including Joanna Kieschnick, a sophomore majoring in English literature. “They said, ‘You’re not good enough’ to so many people who have put their heart and soul into this chapter that I can’t stay,” she said.
In the months since, Cynthia Babington, DePauw’s dean of students, has fielded angry calls from parents, she said. Robert Hershberger, chairman of the modern languages department, circulated the faculty petition; 55 professors signed it.
“We were especially troubled that the women they expelled were less about image and more about academic achievement and social service,” Dr. Hershberger said.
During rush activities this month, 11 first-year students accepted invitations to join Delta Zeta, but only three have sought membership.
On Feb. 2, Rachel Pappas, a junior who is the chapter’s former secretary, printed 200 posters calling on students to gather that afternoon at the student union. About 50 students showed up and heard Ms. Pappas say the sorority’s national leaders had misrepresented the truth when they asserted they had evicted women for lack of commitment.
“The injustice of the lies,” she said, “is contemptible.”
**found at : http://www.nytimes.com/2007/02/25/education/25sorority.html?em&ex=1172725200&en=f85e2c9ae904de9c&ei=5087%0A
Skip to next paragraph
Enlarge This Image
Andrew Hancock for The New York Times
Women at DePauw University in Indiana who were either asked to leave the Delta Zeta house or resigned in protest hold a sorority photo.
Enlarge This Image
Andrew Hancock for The New York Times
Elizabeth Haneline, who was among those evicted, said, “The Greek system hasn’t changed at all, but instead of racism, it’s image now.”
Worried that a negative stereotype of the sorority was contributing to a decline in membership that had left its Greek-columned house here half empty, Delta Zeta’s national officers interviewed 35 DePauw members in November, quizzing them about their dedication to recruitment. They judged 23 of the women insufficiently committed and later told them to vacate the sorority house.
The 23 members included every woman who was overweight. They also included the only black, Korean and Vietnamese members. The dozen students allowed to stay were slender and popular with fraternity men — conventionally pretty women the sorority hoped could attract new recruits. Six of the 12 were so infuriated they quit.
“Virtually everyone who didn’t fit a certain sorority member archetype was told to leave,” said Kate Holloway, a senior who withdrew from the chapter during its reorganization.
“I sensed the disrespect with which this was to be carried out and got fed up,” Ms. Holloway added. “I didn’t have room in my life for these women to come in and tell my sisters of three years that they weren’t needed.”
Ms. Holloway is not the only angry one. The reorganization has left a messy aftermath of recrimination and tears on this rural campus of 2,400 students, 50 miles southwest of Indianapolis.
The mass eviction battered the self-esteem of many of the former sorority members, and some withdrew from classes in depression. There have been student protests, outraged letters from alumni and parents, and a faculty petition calling the sorority’s action unethical.
DePauw’s president, Robert G. Bottoms, issued a two-page letter of reprimand to the sorority. In an interview in his office, Dr. Bottoms said he had been stunned by the sorority’s insensitivity.
“I had no hint they were going to disrupt the chapter with a membership reduction of this proportion in the middle of the year,” he said. “It’s been very upsetting.”
The president of Delta Zeta, which has its headquarters in Oxford, Ohio, and its other national officers declined to be interviewed. Responding by e-mail to questions, Cynthia Winslow Menges, the executive director, said the sorority had not evicted the 23 women, even though the national officers sent those women form letters that said: “The membership review team has recommended you for alumna status. Chapter members receiving alumnae status should plan to relocate from the chapter house no later than Jan. 29, 2007.”
Ms. Menges asserted that the women themselves had, in effect, made their own decisions to leave by demonstrating a lack of commitment to meet recruitment goals. The sorority paid each woman who left $300 to cover the difference between sorority and campus housing.
The sorority “is saddened that the isolated incident at DePauw has been mischaracterized,” Ms. Menges wrote. Asked for clarification, the sorority’s public relations representative e-mailed a statement saying its actions were aimed at the “enrichment of student life at DePauw.”
This is not the first time that the DePauw chapter of Delta Zeta has stirred controversy. In 1982, it attracted national attention when a black student was not allowed to join, provoking accusations of racial discrimination.
Earlier this month, an Alabama lawyer and several other DePauw alumni who graduated in 1970 described in a letter to The DePauw, the student newspaper, how Delta Zeta’s national leadership had tried unsuccessfully to block a young woman with a black father and a white mother from joining its DePauw chapter in 1967.
Despite those incidents, the chapter appears to have been home to a diverse community over the years, partly because it has attracted brainy women, including many science and math majors, as well as talented disabled women, without focusing as exclusively as some sororities on potential recruits’ sex appeal, former sorority members said.
“I had a sister I could go to a bar with if I had boy problems,” said Erin Swisshelm, a junior biochemistry major who withdrew from the sorority in October. “I had a sister I could talk about religion with. I had a sister I could be nerdy about science with. That’s why I liked Delta Zeta, because I had all these amazing women around me.”
Skip to next paragraph
Enlarge This Image
Andrew Hancock for The New York Times
Rachel Pappas, former chapter secretary, discussing the events in class. At a rally, she said national leaders had misrepresented the truth.
But over the years DePauw students had attached a negative stereotype to the chapter, as evidenced by the survey that Pam Propsom, a psychology professor, conducts each year in her class. That image had hurt recruitment, and the national officers had repeatedly warned the chapter that unless its membership increased, the chapter could close.
At the start of the fall term the national office was especially determined to raise recruitment because 2009 is the 100th anniversary of the DePauw chapter’s founding. In September, Ms. Menges and Kathi Heatherly, a national vice president of the sorority, visited the chapter to announce a reorganization plan they said would include an interview with each woman about her commitment. The women were urged to look their best for the interviews.
The tone left four women so unsettled that they withdrew from the chapter almost immediately.
Robin Lamkin, a junior who is an editor at The DePauw and was one of the 23 women evicted, said many of her sisters bought new outfits and modeled them for each other before the interviews. Many women declared their willingness to recruit diligently, Ms. Lamkin said.
A few days after the interviews, national representatives took over the house to hold a recruiting event. They asked most members to stay upstairs in their rooms. To welcome freshmen downstairs, they assembled a team that included several of the women eventually asked to stay in the sorority, along with some slender women invited from the sorority’s chapter at Indiana University, Ms. Holloway said.
“They had these unassuming freshman girls downstairs with these plastic women from Indiana University, and 25 of my sisters hiding upstairs,” she said. “It was so fake, so completely dehumanized. I said, ‘This calls for a little joke.’ ”
Ms. Holloway put on a wig and some John Lennon rose-colored glasses, burst through the front door and skipped around singing, “Ooooh! Delta Zeta!” and other chants.
The face of one of the national representatives, she recalled, “was like I’d run over her puppy with my car.”
The national representatives announced their decisions in the form letters, delivered on Dec. 2, which said that Delta Zeta intended to increase membership to 95 by the 2009 anniversary, and that it would recruit using a “core group of women.”
Elizabeth Haneline, a senior computer science major who was among those evicted, returned to the house that afternoon and found some women in tears. Even the chapter’s president had been kicked out, Ms. Haneline said, while “other women who had done almost nothing for the chapter were asked to stay.”
Six of the 12 women who were asked to stay left the sorority, including Joanna Kieschnick, a sophomore majoring in English literature. “They said, ‘You’re not good enough’ to so many people who have put their heart and soul into this chapter that I can’t stay,” she said.
In the months since, Cynthia Babington, DePauw’s dean of students, has fielded angry calls from parents, she said. Robert Hershberger, chairman of the modern languages department, circulated the faculty petition; 55 professors signed it.
“We were especially troubled that the women they expelled were less about image and more about academic achievement and social service,” Dr. Hershberger said.
During rush activities this month, 11 first-year students accepted invitations to join Delta Zeta, but only three have sought membership.
On Feb. 2, Rachel Pappas, a junior who is the chapter’s former secretary, printed 200 posters calling on students to gather that afternoon at the student union. About 50 students showed up and heard Ms. Pappas say the sorority’s national leaders had misrepresented the truth when they asserted they had evicted women for lack of commitment.
“The injustice of the lies,” she said, “is contemptible.”
**found at : http://www.nytimes.com/2007/02/25/education/25sorority.html?em&ex=1172725200&en=f85e2c9ae904de9c&ei=5087%0A
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