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Financial Aid Probe Focuses On Johns Hopkins Official

April 10, 2007

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Investigators in New York, probing ties between college officials and the student loan industry, are reportedly focusing on student aid advisors at three universities.

New York Attorney General Andrew Cuomo is looking into allegations of improper payoffs to university officials in exchange for their steering students to favored lenders.

According to investigators, the probe has focused on administrators at John's Hopkins in Baltimore, Maryland; Widener University in Chester, Pennsylvania; and Capella University in Minneapolis, Minnesota. All three are suspected of receiving money from Student Loan Xpress in return for steering students to the lender.

Johns Hopkins issued a statement, saying it had been informed by the parent company of Student Loan Xpress Inc. about consulting fees and travel expenses paid to a Johns Hopkins student financial aid official, Ellen Frishberg. The parent company, CIT Group Inc., told Johns Hopkins that the official had been paid about $65,000 in consulting fees and $1,200 in travel expenses since 2002.

The university said Frishberg is director of student financial services at Johns Hopkins' Homewood campus. The university said she was placed on paid administrative leave pending an inquiry by the university into the circumstances of the payments.

The university also revealed that Frishberg serves on a Student Loan Xpress advisory board. Some of the travel expenses she received, the university said, were reimbursement in regard to that service.

"The university has received a letter from the office of the attorney general of New York State requesting information," Johns Hopkins said in a statement. "The university is committed to operating its financial aid program in compliance with the highest ethical standards and will, of course, cooperate with the attorney general's request."

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