2008 Woodie Awards
Miami severs tie with loan firm
State inquiry questions fine lines among schools, business partnerships
Megan Weiland
Issue date: 8/21/07 Section: Campus
Following an investigation by the New York Attorney General Andrew Cuomo, Nelnet, who claims to be the nation's second largest loan consolidator, was forced July 31 to end its relationship with more than 100 alumni associations, Miami University's included.
In May, Miami set the ball rolling by becoming the first Ohio university to disclose its financial arrangements with Nelnet, while under a similar investigation by the Ohio Attorney General
Marc Dann.
"Nelnet is a company that services student loan consolidation to graduates," said Raymond Mock, associate vice president in the Office of Alumni Relations. "We often partner with services to help our alums but they must be a reputable company that has been involved for several years with other alumni associations as well."
Mock added that the alumni association chose to terminate that relationship June 8 until further notice.
"After discussing the situation with the university's general counsel and with Nelnet, we informed them on June 8 that we would end our agreement effective immediately, and wait until the attorney general and/or legislature redefined the parameters of these relationships," he said via e-mail. "Shortly after, Nelnet announced that they were terminating all relationships with alumni associations, based on the direction that legislation seemed to be headed on this issue."
According to university spokesperson Claire Wagner, Nelnet was allowed to use Miami alumni association's logos to market their services to graduating students in return for compensation to the university.
"It is completely different from the attorney general's loan investigation," said Wagner in reference to an investigation into certain banks offering schools kickbacks in exchange for their recommendation.
"Nelnet was listed as one of our partner programs under online services on the alumni association Web page," Wagner said. "We received $25,000 a year from them during 2003-06 and a one-time check of $7,200."
In May, Miami set the ball rolling by becoming the first Ohio university to disclose its financial arrangements with Nelnet, while under a similar investigation by the Ohio Attorney General
Marc Dann.
"Nelnet is a company that services student loan consolidation to graduates," said Raymond Mock, associate vice president in the Office of Alumni Relations. "We often partner with services to help our alums but they must be a reputable company that has been involved for several years with other alumni associations as well."
Mock added that the alumni association chose to terminate that relationship June 8 until further notice.
"After discussing the situation with the university's general counsel and with Nelnet, we informed them on June 8 that we would end our agreement effective immediately, and wait until the attorney general and/or legislature redefined the parameters of these relationships," he said via e-mail. "Shortly after, Nelnet announced that they were terminating all relationships with alumni associations, based on the direction that legislation seemed to be headed on this issue."
According to university spokesperson Claire Wagner, Nelnet was allowed to use Miami alumni association's logos to market their services to graduating students in return for compensation to the university.
"It is completely different from the attorney general's loan investigation," said Wagner in reference to an investigation into certain banks offering schools kickbacks in exchange for their recommendation.
"Nelnet was listed as one of our partner programs under online services on the alumni association Web page," Wagner said. "We received $25,000 a year from them during 2003-06 and a one-time check of $7,200."
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