Skip To Content
JEWISH. INDEPENDENT. NONPROFIT.
Back to Opinion

Move To Clean Up Student Loan Racket

Aid to students is a big business in the U.S. This year it comes to $18 billion dollars in bank subsidies, mainly for students in low-income families. It is customary for schools to provide an office to advise students on how and where to get the money.

Investigations by New York Attorney General Andrew Cuomo and others have uncovered a widespread practice by lending institutions who engage in what is, in effect, bribery of school officials to win the contracts for their companies. They paid for meals, trips, cash payments, the employment of college personnel and similar perks.

Both the House and Senate took action to halt this distasteful practice. In the Senate, Edward Kennedy played a leading role in the enactment of such legislation. His bill won overwhelming approval, 78 to18. In the House of Representatives, a similar bill passed by 273 to 149.

Cuomo moved quickly to implement the legislation. As of July 21, Cuomo announced a settlement with College Loan in the sum of half a million dollars. It is the 11th settlement, and the money will go into an education fund set up by Cuomo.

Republish This Story

Please read before republishing

We’re happy to make this story available to republish for free, unless it originated with JTA, Haaretz or another publication (as indicated on the article) and as long as you follow our guidelines. You must credit the Forward, retain our pixel and preserve our canonical link in Google search.  See our full guidelines for more information, and this guide for detail about canonical URLs.

To republish, copy the HTML by clicking on the yellow button to the right; it includes our tracking pixel, all paragraph styles and hyperlinks, the author byline and credit to the Forward. It does not include images; to avoid copyright violations, you must add them manually, following our guidelines. Please email us at [email protected], subject line “republish,” with any questions or to let us know what stories you’re picking up.

We don't support Internet Explorer

Please use Chrome, Safari, Firefox, or Edge to view this site.