illusionofjoy | New York student loan investigation

Although nearly a month old, this is still news to me: New York State Attorney General Andrew M. Cuomo revealed deceptive practices uncovered during a nationwide investigation into the college loan industry. From the press release:

Industry practices revealed include: Establishment of so-called “preferred lender” lists without disclosing the basis for selection or the specific benefits associated with these preferred lenders; revenue sharing and other financial arrangements between schools and lenders; denials or impediments to a student or parent’s choice of lender based on the borrower’s selection of a particular lender or guaranty agency; impediments to competition in the lending industry that stifle better loan terms for students and parents.

Attorney General Cuomo said, "There is an unholy alliance between banks and institutions of higher education that may often not be in the students’ best interest. The financial arrangements between lenders and these schools are filled with the potential for conflicts of interest. In some cases they may break the law."

As I live in Pennsylvania - and have for about five years now - I'm not surprised that I didn't know about this investigation sooner. Also unsurprising is that this is happening in the first place. I remember trips to the financial aid office during my misspent college years were not particularly productive. Usually they consisted of conflicting "facts" from a representative - usually another student - who would then always conveniently highlight the student loan option.

Not to be optimistic, but I wonder if I could possibly be due for some financial reimbursement for all the trouble I went through in school...