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Friday, November 02, 2007
WASHINGTON (Reuters) - Six Senate Democrats called on Thursday for a complete accounting by the Bush administration of overpayments by the U.S. Education
Department to college student loan firms under a loan program that guaranteed the firms a 9.5 percent interest rate.
The overpayments may have totaled hundreds of millions of dollars from 2003 to 2006 and taxpayers have a right to know the actual amount, the senators said in an October 31 letter sent to the department's inspector general.
"Taxpayers also deserve information on which lenders were involved, what methods they used to claim these subsidies unfairly, and why the department allowed the inappropriate subsidies to be paid," the senators in a statement.
The letter requesting the investigation was signed by Illinois's Barack Obama, New York's Hillary Clinton, Washington's Patty Murray, Massachusetts' Edward Kennedy, North Dakota's Byron Dorgan and Maryland's Barbara Mikulski.
The request adds to numerous inquiries into student loans and the Education Department. Not only the 9.5 percent loan program, but student loan marketing practices have been under scrutiny for months since a scandal over kickbacks and conflicts of interest embarrassed the $85 billion industry.
During the scandal, House education committee Chairman George Miller said the Justice Department was looking into an audit of lender group Nelnet Inc.
Nelnet earlier this year agreed to a settlement with the Education Department over an audit by the department's inspector general of a portfolio of loans that got special payments under the 9.5 percent loan program.
Under the settlement, Nelnet was allowed to keep $278 million of the payments it received before July 1, 2006, while foregoing subsequent claims.
Source: http://www.reuters.com/article/bondsNews/idUSN0121153120071101
YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.