Columbia University said Tuesday it has dismissed its director of financial aid after released documents showed he promoted a student loan company in which he had a financial stake.
The aid official, David Charlow, was fired amid an investigation by New York Attorney General Andrew Cuomo, who is probing abuses in the $85 billion U.S. student loan industry.
Columbia said in a statement that it promptly brought information received about Charlow's relationship with former preferred lender Student Loan Xpress Inc. to Cuomo's attention last month.
"As of today, Mr. Charlow has now been dismissed from his employment," the university said in the statement.
Columbia spokesman Robert Hornsby said that "Charlow, a long-term and well regarded employee, abused a position of trust and violated the university policy on conflicts of interest."
New York-based Columbia placed Charlow on leave in April after regulatory filings showed he sold shares in Education Lending Group, the former parent of Student Loan Xpress, for a gain of more than $100,000. Student Loan Xpress is now a unit of CIT Group Inc.
There was no answer Tuesday morning at a home telephone number listed for Charlow. His attorney was not immediately available for comment.
According to a report in Tuesday's New York Times, Charlow sent letters to parents and alumni on three occasions praising Student Loan Xpress.
A letter sent to Columbia on Saturday by Benjamin Lawsky, deputy counselor and special assistant to Cuomo, said Charlow put Student Loan Xpress on Columbia's list of preferred lenders after he received the stock, even though the company had not bid to be a preferred lender, according to the newspaper.
The newspaper said e-mail messages and letters to and from Charlow show that he advised Student Loan Xpress on marketing strategy, pushed its loans and helped draft talking points for the company's sales force.
The e-mail messages showed Charlow also accepted tickets provided by the lender to sports events and rock concerts at a time when he was urging parents and alumni to do business with the company, the newspaper reported.
Officials working with Cuomo said documents provided by Columbia were evidence that the university had failed to supervise its aid program, the newspaper reported. Cuomo's office has called on Columbia's president, Lee Bollinger, to "immediately overhaul the operation," the report said.
Hornsby said the university has been working with Cuomo's office to implement the attorney general's code of conduct on financial aid practices.
Cuomo's office is investigating whether student lenders paid kickbacks to universities and financial aid officials to win business. CIT agreed on May 10 to pay $3 million to settle a probe by the attorney general.
Charlow is the latest U.S. university aid official to step down amid the ongoing investigation. On Monday, Johns Hopkins University said financial aid director Ellen Frishberg had resigned after receiving $65,000 in improper payments from Student Loan Xpress.
Last week, the University of Texas at Austin fired student aid director Lawrence Burt after an internal inquiry found he owned stock in Student Loan Xpress's former parent.Labels: financial aid, scholarship, student loans |
