Two more universities settle student loan cases (AP/CNN)

[eppur_se_muova]

ALBANY, New York (AP) -- Drexel University in Philadelphia and Capella University, an online college based in Minneapolis, settled student loan steering cases with New York Attorney General Andrew Cuomo on Tuesday.

Drexel, which said in April it did nothing wrong and vowed to defend its practices, agreed to pay student borrowers the $250,000 it had accepted from a lender in exchange for a listing as the school's "preferred lender," Cuomo said.

Drexel made a deal that paid it 1 percent of the value of students loans provided by Education Finance Partners, a major college lender, Cuomo said. After Drexel made EFP its exclusive prime lender, EFP did $25 million in loan business with Drexel students. Under the agreement, Drexel received $124,021, with another $126,031 accrued but not yet paid.

Drexel allowed the lender to use its name, logo and mascot in marketing to Drexel students, Cuomo said. In addition, EdAmerican Inc., another lender, operated a telephone call-in center on behalf of Drexel's financial aid office, leaving and students and families unaware they were speaking to employees of a lending company and not the college.

Cuomo said Capella's director of financial aid and some of his employees received gifts, trips, golf accessories and other inducements including consulting fees from Student Loan Xpress, one of the college's preferred lenders at the time.
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more: http://www.cnn.com/2007/EDUCATION/05/15/student.loan.probe.ap/index.html

[lonestarnot]

1. Tee hee. Wonder how many?