In a press release dated May 3, New York State attorney general Andrew Cuomo (left) announced subpoenas of 90 college and university alumni associations. The goal? "Full disclosure of their relationships with Nelnet, one of the nation's largest student loan consolidation companies."
The press release quotes Cuomo as saying:
Our latest action targets alumni associations across the country and their relationships with one of the nations’ [sic] largest loan consolidators – Nelnet.
Nelnet, based in Nebraska, provides students and alumni with consolidation of federal and private student loans. This investigation follows on the heels of the AG's aggressive investigation of so-called preferred lenders' relationships with financial aid offices on many campuses nationwide.
At issue now is "whether alumni associations received and failed to disclose payments from Nelnet for steering their members exclusively to the student loan consolidator." The AG is also interested in fees paid to associations, such as revenue sharing or other similar arrangements.
Among the documents requested in the subpoenas are those:
- pertaining to criteria used for selecting student loan consolidator partners;
- establishing how the relationship with Nelnet began;
- showing whether the alumni association compared other loan consolidators’ rates to those of Nelnet;
- showing benefits given by Nelnet to any employee of the alumni association including meals, trips, gifts or other perks.
In addition, they're collecting actual contracts, records of payments, and communication between alumni staff and the schools whose alumni they represent.
Cuomo is an alumnus of Fordham University ('79) and Albany Law School ('82).
Photo credit: Office of NY State Attorney General
