Colleges take loan kickbacks, N.Y. official says

The AP reports:

New York's attorney general has accused colleges across the country of taking kickbacks from student loan companies and reaping other benefits while making it harder for students to get better deals on their loans.

New York Attorney General Andrew Cuomo said Thursday an investigation he began last month into the $85 billion student loan industry found numerous arrangements made to benefit schools and lenders over the students. In some cases, it found that lenders provided all-expense-paid trips for college financial aid officers to exotic locations in return for directing students to the lenders.

Cuomo's office is investigating at least six lenders: the nation's largest student-loan provider SLM Corp. -- commonly known as Sallie Mae; Nelnet Inc.; Education Finance Partners Inc.; EduCap Inc.; the College Board; and CIT Group Inc.

Cuomo said he is investigating at least 100 schools, including some Ivy League institutions.

Cuomo said he has the authority to conduct a nationwide investigation because schools from across the country recruit students from New York.

Time to separate school from state.