Student-Loan Company Is Allowed to Keep 278 million it billed improperly.

[techs]

http://www.nytimes.com/2007/01/20/washington/20loans.html

The Bush administration reached an accord with a student loan company that will let it keep $278 million in subsidies that the inspector general of the Education Department found improper, the department said yesterday.

Under the agreement, the department will suspend future payments of more than $800 million, in addition to the $278 million paid to the company, Nelnet, until an audit determines whether the company was eligible for the money.
Under Secretary of Education Sara Martinez Tucker said the department had decided not to recover past payments because such a precedent might require it to pursue other loan companies, too, possibly driving smaller ones out of business and reducing borrowing options.

?We were trying to make the best decision for the taxpayer and the student,? Ms. Tucker said in a conference call with reporters.

The issue is politically charged. Democrats have in the past accused the Education Department of being lax in preventing lenders from exploiting the program, in part because of the administration?s connections with lenders. Nelnet officers and its political action committee have been major donors to Republicans.


Business as usual for the Bushies. Give away billions for nothing and claim it is for the good of the people.

 

[Whoozyerdaddy]

Originally posted by: techs
Business as usual for the Bushies. Give away billions for nothing and claim it is for the good of the people.

Not that I approve of this, but maybe you could explain how this kind of activity is unique to the Bush administration?

 

[dahunan]

It isn't unique.. BUT they sure had the ability to stop it .. and..

 

[EagleKeeper]

Originally posted by: dahunan
It isn't unique.. BUT they sure had the ability to stop it .. and..

They did. The company still has to do the work - they juut are not getting paid any more.

Under the agreement, the department will suspend future payments of more than $800 million, in addition to the $278 million paid to the company, Nelnet, until an audit determines whether the company was eligible for the money.

And the above quote was in the OP.

 

[dmcowen674]

Originally posted by: Whoozyerdaddy

Originally posted by: techs
Business as usual for the Bushies. Give away billions for nothing and claim it is for the good of the people.

Not that I approve of this, but maybe you could explain how this kind of activity is unique to the Bush administration?

It's not, just that they have taken it all to a whole new level.

 

[Malak]

EagleKeeper is apparently the only one here that can read.

 

[techs]

Originally posted by: Malak
EagleKeeper is apparently the only one here that can read.

Nope. They get to keep the money they billed for improperly and were paid (278 million dollars)and will only have their outstanding bills corrected so they can't get any more of our FREE money.

 

[EagleKeeper]

So they get to hold onto 278 but will not get paid 800.

Sounds like the company is temporarily out 522 until they have an audit.

They may end up getting the 278 because of the cost of going after ever one else (per the article) may not be worth the final consequences.

decided not to recover past payments because such a precedent might require it to pursue other loan companies, too, possibly driving smaller ones out of business and reducing borrowing options.

Also, if the Dems in the house can break government contracts, I am sure that they can force the government to fully recover all those funds if the DEMS want to do so.

So the Dems can show that they want to cleanup government or they can go along with the existing system. cut the cost of student loands and also reduce the source of loans.

which will play better down the road?

 

[Jhhnn]

What a great scam. Lenders charge rates well above the going rate, get a government guarantee of repayment, then recycle part of the funds back into the election campaigns of their enablers... with the taxpayers picking up the difference between what students pay and what the loan companies actually collect...

Public financing of political campaigns at its finest...

Reduce availability of loans? Not even in your dreams. The guarantee from the govt is more than enough to keep money flowing at honest market rates- there's no risk.

If repubs hadn't been so intent on looting over the last 6 years, the govt would probably have a surplus, and be able to lend the money themselves, turning a liability into an asset... and the loan companies forced to find other venues for investment...

 

[techs]

Originally posted by: EagleKeeper
So they get to hold onto 278 but will not get paid 800.

Sounds like the company is temporarily out 522 until they have an audit.

They may end up getting the 278 because of the cost of going after ever one else (per the article) may not be worth the final consequences.

decided not to recover past payments because such a precedent might require it to pursue other loan companies, too, possibly driving smaller ones out of business and reducing borrowing options.

Also, if the Dems in the house can break government contracts, I am sure that they can force the government to fully recover all those funds if the DEMS want to do so.

So the Dems can show that they want to cleanup government or they can go along with the existing system. cut the cost of student loands and also reduce the source of loans.

which will play better down the road?

Once again you are reading it wrong. They will get every penny they are due from the remaining 800 million after it is corrected for their scam. How can you equate letting people keep 278 million in illegal money and then ONLY pay them what they should have gotten out of the rest of their scam as some kind of good thing???

 

[EagleKeeper]

I agree they will get the 278 in the end. Some-one has determiend that the if they go after one, they need to go after all and the consequences of that may be a problem.

The servicing company problem now is they are short 522 for the time being.

And you know how long it can take an audit to happen.

Maybe the people that can renege on government contracts can also force the issue here

 

[techs]

Originally posted by: EagleKeeper
I agree they will get the 278 in the end. Some-one has determiend that the if they go after one, they need to go after all and the consequences of that may be a problem.

The servicing company problem now is they are short 522 for the time being.

And you know how long it can take an audit to happen.

Maybe the people that can renege on government contracts can also force the issue here

The story doesn't say they won't get the additional monies in a timely manner. It just says they will now look at the bills, instead of just automatically paying them. I highly doubt a company that is a significant contributor to the Republicans that just got a FREE 278 million dollars of our money, will not get their bills approved in a timely manner.
After all, this whole incident shows they are getting the political influence their money has paid for.

 

[MadRat]

From the wording of the article. That $800 million was further improper billings. This was a program of billions, which they still get to collect funds on properly billed accounts. They got a free quarter of a billion dollars for being crooked. They may be able to collect more money the improper way if they can show that they followed the rules even improperly. This is a lose-lose arbitration for the taxpayer.

 

[ProfJohn]

The Education Department had said it was following policies that the Clinton administration established.

It is a shame the Times did not elaborate on that line.

 

[fornax]

Originally posted by: EagleKeeper
Also, if the Dems in the house can break government contracts, I am sure that they can force the government to fully recover all those funds if the DEMS want to do so.

So the Dems can show that they want to cleanup government or they can go along with the existing system. cut the cost of student loands and also reduce the source of loans.

which will play better down the road?

We seem to have a new Steeplerot in the forum. Doesn't matter how despicable the Bush government is, EagleKeeper will argue until he's blue in the face about how fine they are and how it's all the Democrats' fault. The Democrats ARE NOT in the government. Your brain-dead Bush and his corrupt junta ARE the government, and it's their job to clean up the mess they created and return the stolen money.

 

[fornax]

Originally posted by: Malak
EagleKeeper is apparently the only one here that can read.

Nope, and apparently neither can you. The company gets to keep the stolen money. You and I get to pay higher taxes. The Bush cronies get to keep the campaign contributions. EagleKeeper will continue having orgasms just reading about the great and wise ruler Bush. It's a beautiful world living under Bush, isn't it?

 

[dahunan]

Originally posted by: EagleKeeper

Originally posted by: dahunan
It isn't unique.. BUT they sure had the ability to stop it .. and..

They did. The company still has to do the work - they juut are not getting paid any more.

Under the agreement, the department will suspend future payments of more than $800 million, in addition to the $278 million paid to the company, Nelnet, until an audit determines whether the company was eligible for the money.

And the above quote was in the OP.

6 years later?

 

[EagleKeeper]

Originally posted by: dahunan

Originally posted by: EagleKeeper

Originally posted by: dahunan
It isn't unique.. BUT they sure had the ability to stop it .. and..

They did. The company still has to do the work - they juut are not getting paid any more.

Under the agreement, the department will suspend future payments of more than $800 million, in addition to the $278 million paid to the company, Nelnet, until an audit determines whether the company was eligible for the money.

And the above quote was in the OP.

6 years later?

Regretfully, the article can raise more questions than it answers.
1) Should the government not force the issue becuase of the potential repercussions to other vendors. The article states that the government is afraid of the consequences to lavailability of the student loan.

My feeling is that no one wants to force the issue because of paperwork involved that will create extra work and expose incompetence.

2) Will Congress (at the urging of the Dems) force the issue to be addressed and corrected.

Congress will hem and haw and forget the issue unless it becomes a political hot potatoe.

 

[Arglebargle]

I KNOW this was going on for quite a while. Had a friend who worked in state government oversight who ran across this in the early '90's. The agency head moved to close the loopholes, and within 24 hours, political hell insued and everything was papered over. Both left the agency shortly thereafter. They were talking about taking millions of dollars away from LAWYERS, and the lawyers brought in the big guns quick. And this was a program that won awards from the Clinton administration for its efficiency. Definitely not a 'Bush only' problem. Still, the slap on the wrist punishment is telling. See if you could get away with that after embezzling $20K.....

 

[JEDIYoda]

Originally posted by: ProfJohn

The Education Department had said it was following policies that the Clinton administration established.

It is a shame the Times did not elaborate on that line.

exactly!!