2008 Woodie Awards
Central Michigan targeted for loan fund agreement
8 CMU part of loan scandal
Issue date: 1/7/08 Section: Year in Review
Originally published Aug. 1
Staff Reports
CMU's Athletics Department and Alumni Association received extra money from student loan providers for completed loan applications, according to an Aug. 2 report by the Detroit Free Press.
According to documents the Free Press obtained, University Financial Services, a Florida-based loan provider, paid CMU's athletics department $10,000 per year, plus $75 per completed loan application it received after 150.
In addition, Nebraska-based Nelnet paid CMU's Alumni Association $20,000 when their agreement was signed, plus $20,000 per year and an additional $100 for each completed loan application after 250.
Both UFS and Nelnet are under investigation for providing kickbacks, payments for loan applications and other perks to universities in exchange for advertising their loans to students. Such actions are violations of federal law.
CMU was asked to release documents on July 25 about its affiliation with UFS.
The New York Attorney General's office asked the university, as well as Wayne State University and University of Detroit-Mercy, to turn over documents relating to UFS and the relationship it has with CMU's athletic department.
The attorney general's office is investigating whether agreements between any of the 40 universities and UFS were based on revenue sharing and kickbacks.
Steve Smith, director of media relations at CMU, said the university has had a relationship with UFS for about a year.
He said the university received the request for information via fax.
"Our general counsel (Eileen Jennings) is reviewing it," Smith said. "Depending on what her recommendations are, that's how we'll proceed."
The investigation stemmed from a deal between UFS and Dowling College in New York in which Dowling's athletic department received $75 for each loan application UFS received.
In return, UFS advertisements were placed on Dowling's athletics Web site and department interns distributed promotional materials at events.
As of July 26, CMU's athletics Web site featured a similar advertisement from UFS that says: "Save money! Lower your student loan payments by as much as 50 percent."
Smith said removing the advertisement is something the general counsel will discuss during the review.
In an Aug. 2 Detroit News story, Dave Heeke, athletics director at CMU, is quoted saying: "Sure, we're concerned about it. They are one of our Web site advertisers and we have a sponsorship agreement with them. To my understanding they have paid a lump-sum fee and nothing more."
news@cm-life.com
Staff Reports
CMU's Athletics Department and Alumni Association received extra money from student loan providers for completed loan applications, according to an Aug. 2 report by the Detroit Free Press.
According to documents the Free Press obtained, University Financial Services, a Florida-based loan provider, paid CMU's athletics department $10,000 per year, plus $75 per completed loan application it received after 150.
In addition, Nebraska-based Nelnet paid CMU's Alumni Association $20,000 when their agreement was signed, plus $20,000 per year and an additional $100 for each completed loan application after 250.
Both UFS and Nelnet are under investigation for providing kickbacks, payments for loan applications and other perks to universities in exchange for advertising their loans to students. Such actions are violations of federal law.
CMU was asked to release documents on July 25 about its affiliation with UFS.
The New York Attorney General's office asked the university, as well as Wayne State University and University of Detroit-Mercy, to turn over documents relating to UFS and the relationship it has with CMU's athletic department.
The attorney general's office is investigating whether agreements between any of the 40 universities and UFS were based on revenue sharing and kickbacks.
Steve Smith, director of media relations at CMU, said the university has had a relationship with UFS for about a year.
He said the university received the request for information via fax.
"Our general counsel (Eileen Jennings) is reviewing it," Smith said. "Depending on what her recommendations are, that's how we'll proceed."
The investigation stemmed from a deal between UFS and Dowling College in New York in which Dowling's athletic department received $75 for each loan application UFS received.
In return, UFS advertisements were placed on Dowling's athletics Web site and department interns distributed promotional materials at events.
As of July 26, CMU's athletics Web site featured a similar advertisement from UFS that says: "Save money! Lower your student loan payments by as much as 50 percent."
Smith said removing the advertisement is something the general counsel will discuss during the review.
In an Aug. 2 Detroit News story, Dave Heeke, athletics director at CMU, is quoted saying: "Sure, we're concerned about it. They are one of our Web site advertisers and we have a sponsorship agreement with them. To my understanding they have paid a lump-sum fee and nothing more."
news@cm-life.com
