Wednesday, April 11, 2007

Big Fish Landed for $4 Million, Small Fish Dangled for Public Viewing

In a classic bait and switch, Andrew Cuomo went from highlighting the bad behavior of a relative small fry to accepting fines from similar "badly behaving" heavy hitters. The news teemed with stories of Student Loan Xpress' illicit business dealings around student loans. Yet who'd already settled with the New York Attorney General, Sallie Mae and Citibank. Each ponied up $2 million in fines for their illegal efforts to steer higher education loans their way.

Why the difference in treatment if all used unethical incentives to get university financial departments to give them special treatment? A look at political donations the last 3 election cycles might provide some insight. Donations from each company’s PAC show CitiGroup gave nearly $1.5 million, Sallie Mae $1.5 million and Education Lending Group $15,500.

The smaller giver may have played the dirtiest in more than one field. While raising nearly $50,000 each of the last two election cycles, very little of ELG’s PAC money made it to actual candidates, other than Randy “Duke” Cunningham. Where did it go?

Did they wash it around to other PAC’s? One $10,000 check was sent in July 2003 to the same address as a Republican political strategy firm, Shockley Public Strategies and its principal, Leslie Beyers. Republican National Committee campaign expenses for 2004 show payments totaling $27,000 to the company for communication services. It also reimbursed Leslie Shockley-Beyers $1,424, Beyer, Leslie $971, and Leslie Beyer $672 for travel expenses.

Will Andrew Cuomo follow the suspicious $10,000 check from Education Lending’s PAC? Doubtful as it may shine the light on huge political donations from American student loan businesses to both Republicans and Democrats.

Citigroup and Sallies Mae get to act like President Bush after a horrific hurricane hit the Gulf Coast. They admit to not doing as much as they could have to run a good operation but promise to do better in the future. The book will be thrown at the smaller company also behaving badly. CIT Group, the parent company of Student Xpress will be treated like the soldiers at Abu Ghraib. Yes, an example will be made of their criminal behavior, while the system hides the much wider abuses…

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