The New York State Attorney General is investigating whether officials at Universities received illegal kickbacks from lenders. Although there's a NY Times article, the article in the Wall Street Journal better explains the kickback scheme.
Mr. Charlow, the associate dean of student affairs at Columbia, owned 7,500 shares and 2,500 warrants of Education Lending Group Inc., the parent of Student Loan Xpress, at the time of a September 2003 stock offering, Education Lending said in a Securities and Exchange Commission filing.
Lawrence Burt, associate vice president of student affairs and director of the office of student financial services at the University of Texas at Austin, is listed in the offering document as owning 1,500 shares and 500 warrants. So is Catherine Thomas, associate dean and director of financial aid at the University of Southern California.
New York state officials said Mr. Charlow made a total profit of at least $100,000 selling those shares in 2005. Comparable figures weren't available for Mr. Burt and Ms. Thomas. Mr. Charlow and Ms. Thomas couldn't be reached for comment. James Grant, a USC spokesman, said the school "will now review the information in the letter" from the attorney general "and respond."
Read the above carefully, because it states that the university officials owned shares and warrants in this company before a September 2003 stock offering. The shares, therefore, were direct grants and/or sales by the company and were not purchased in the public stock markets.
Are people shocked to discover that high level administrators at prestigious universities, including the Ivy League Columbia University, are greedy crooks? I'm not.
An anonymous poster at xoxohth.com wrote the following comment:
That's a pretty good scam, although not as good as charging $47k/year for college in the first place.
I'd love to see some of those assholes hang for this. God only knows that if you or I were to make a couple of bucks this way, our "betters" in higher education would be screaming for our heads and how corrupt and greedy we are, etc...This almost makes the NY State Attorney's Office look good to me for a change. By the way, higher ed is probably one of the most crooked institutions in the world. Check out the scandal in the CA state system. Some lesbian administrator got her lover a job, home, all kinds of goodies that the school (the students and parents) paid for. I don't know what ever became of the whole thing, but I hope somebody did some time. Sometimes I wonder why the fuck I should be honest, nobody else is, that's for sure. The only thing the above thieves are sorry about is being caught.
Posted by: | April 05, 2007 at 01:42 PM
Modernity sez: People that don't cheat are fat, quavering cuckold hicks and nerds.
Posted by: turkey | April 05, 2007 at 02:07 PM
By the way, higher ed is probably one of the most crooked institutions in the world. Check out the scandal in the CA state system. Some lesbian administrator got her lover a job, home, all kinds of goodies that the school (the students and parents) paid for. I don't know what ever became of the whole thing, but I hope somebody did some time.
Didn't she swan dive off the 40-story balcony outside her San Francisco apartment? Or was that another lesbian?
Posted by: Peter | April 05, 2007 at 09:15 PM
"Didn't she swan dive off the 40-story balcony outside her San Francisco apartment? Or was that another lesbian?"
She was from UC Santa Cruz (I think she was the chancellor), and yes she did jump to her death.
Posted by: Eric the Red | April 05, 2007 at 09:26 PM
If there ever were an industry sorely in need of a massive shakeout and consumer backlash, it's the higher education scam, er, industry.
Of course the chances of any shakeout and especially consumer backlash are zero. Sheeple keep their mouths shut and meekly fork over ever-increasing amounts of money to colleges.
It's regrettable that online learning has never really gone anywhere, despite the ubiquitous University of Phoenix ads.
Posted by: Peter | April 06, 2007 at 09:23 AM
Are people shocked to discover that high level administrators at prestigious universities, including the Ivy League Columbia University, are greedy crooks? I'm not.
Entrepreneurs exploit asymmetries in information. Intelligent people seek out information that they can that others do not have.
It seems to me that HS is just jealous.
Posted by: Loki on the run | April 07, 2007 at 12:42 PM
They took kickbacks, that's illegal.
Posted by: Half Sigma | April 07, 2007 at 05:51 PM