Contact
Christopher T. Cory, Executive Director, Public Information, Pace University
212-346-1117, ccory@pace.edu, cell 917-608-8164
New York, April 19, 2007
Pace University today released the following statement on its settlement with the New York State Attorney General:
Pace University signed an agreement with the NY State Attorney General’s Office confirming our commitment to adopt the Attorney General’s proposed industry-wide code of conduct. We have been voluntarily cooperating with the Attorney General since we were first notified of his investigation at the beginning of February 2007, and our cooperation will continue.
The agreement that Pace signed with the Attorney General does not provide for any restitution or other payments, since Pace University has not participated in any of the lender revenue sharing arrangements that have been reported in the press.
Call Center.
Several weeks ago we voluntarily modified our call center protocol to clarify that Sallie Mae call center personnel are answering the telephones on Pace’s behalf. In addition, we have decided to transition away by August 15 from using Sallie Mae’s affiliate – or any other entity affiliated with a lender – to provide call center services. (Clarification – Pace did not “hire” Sallie Mae personnel – we were not their employer. As the AG release said, we “hired Sallie Mae to staff” a (singular) financial aid call center. Important technical point.)
We do not believe (and we have not admitted) that it is illegal or a conflict of interest for us to outsource various functions, including call centers. We have not found any basis to believe, nor has any evidence been presented to us, that Sallie Mae call center personnel engaged in any steering of Pace students or their parents to Sallie Mae products or that Pace’s students or their parents were harmed in any way by our agreement to outsource the call center.
Sallie Mae personnel providing this service are required to provide only the information and references created by Pace’s Office of Student Assistance, in a lender neutral manner. They are monitored to ensure that they stick to the scripts provided. The documentation provided to the call center is the same as the information that would be provided if a caller connected directly to Pace’s Office of Student Assistance. Furthermore, if the call center personnel are asked a question that is not covered by the Pace scripts, they are required to forward the caller to specified Pace personnel. We have found no evidence, and none has been brought to our attention, that Sallie Mae call center personnel have ever misled students and their parents or violated the “lender neutral” standard.
Employee.
Pace was unaware of a possible conflict by our former Enrollment Management Director at the time of our negotiation of the 2004 agreements with Sallie Mae. We have found no evidence, and none has been presented to us, that the agreements were illegal or, equally important, that any of our students or their parents were harmed as a consequence of our entering into those agreements.
In fact, our former Enrollment Management Director was not the decision maker regarding our contracts with Sallie Mae. Other University officers, in consultation with University Counsel, conducted independent analyses and reached independent decisions on the basis of their assessment of what was in the best interest of our students, their parents and the University.
FYI, since 2004 Pace University has remained in the Direct Lending Program for undergraduate loans and has continued to certify any loans brought to us by our undergraduate and graduate students, regardless of the lender involved.
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