Spring Break
Sallie Mae Leaves Financial Aid Call Center
Controversial Contract Revisited
Laura Senkevitch
Issue date: 10/3/07 Section: News
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The University discontinued outsourcing telephone financial aid inquiries to Sallie Mae employees on Aug. 31, officially making the center an internal operation. The decision to sever ties with Sallie Mae is partially due to the controversial issue of the school-lender relationship publicized last March by New York Attorney General Andrew M. Cuomo.
Since 2004, the University's financial aid call center had been operated by Sallie Mae, the nation's leading loan company. Although generally recognized as a company which provides loans to students seeking financial aid to attend institutions of higher education, the company provides schools with other financial aid related services as well. In the case of the University, Sallie Mae established a call center through the school in order to respond to questions prospective students may have in regard to financial aid.
Former President David A. Caputo said last April, "The decision to outsource to Sallie Mae was due to the fact that we did not have the staff to handle the massive amount of calls. We thought they would give us solid, objective advising and information to our prospective students."
Christopher Cory, executive director of public information, said Sallie Mae employees would take the calls and not identify them as working for the lender. "They identify themselves as the Pace Financial Aid Center," Cory said. According to Cory, the call center did not push Sallie Mae loans. To monitor this, the University periodically made "secret shopper" calls to verify the call center gave unbiased advice.
The controversy around the Sallie Mae-run call center arose last winter when the New York Office of the Attorney General (OAG), directed by Cuomo, began an investigation into the relationship between higher education and lending companies. Cuomo told the New York Times in March the school-lender relationship is "often highly tainted with conflicts of interest." He found some schools accepted deals from companies including computer donations, expense-paid trips for financial aid officers and sometimes even cash.
Since 2004, the University's financial aid call center had been operated by Sallie Mae, the nation's leading loan company. Although generally recognized as a company which provides loans to students seeking financial aid to attend institutions of higher education, the company provides schools with other financial aid related services as well. In the case of the University, Sallie Mae established a call center through the school in order to respond to questions prospective students may have in regard to financial aid.
Former President David A. Caputo said last April, "The decision to outsource to Sallie Mae was due to the fact that we did not have the staff to handle the massive amount of calls. We thought they would give us solid, objective advising and information to our prospective students."
Christopher Cory, executive director of public information, said Sallie Mae employees would take the calls and not identify them as working for the lender. "They identify themselves as the Pace Financial Aid Center," Cory said. According to Cory, the call center did not push Sallie Mae loans. To monitor this, the University periodically made "secret shopper" calls to verify the call center gave unbiased advice.
The controversy around the Sallie Mae-run call center arose last winter when the New York Office of the Attorney General (OAG), directed by Cuomo, began an investigation into the relationship between higher education and lending companies. Cuomo told the New York Times in March the school-lender relationship is "often highly tainted with conflicts of interest." He found some schools accepted deals from companies including computer donations, expense-paid trips for financial aid officers and sometimes even cash.
Viewing Comments 1 - 1 of 1
T.D. Carter
posted 10/04/07 @ 1:54 PM EST
That's GREAT!. The call center never could answer my questions anyway. Else they would take a message, so that someone at OSA would get back to you in 3 days!
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