U.S. Limits Access to Student Loan Database

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Source: JONATHAN D. GLATER

The Education Department last night cut off outside access to a government database that contains the personal financial information of millions of student aid applicants.

The department acted on concerns that loan companies or other marketers were improperly obtaining private information on potential borrowers.

The shutdown, announced by Education Secretary Margaret Spellings, is its strongest response to a broadening student loan scandal that has already implicated loan companies and caused several universities to put their financial aid administrators on leave and review their dealings with lenders.

In a six-page letter to Senator Edward M. Kennedy, chairman of the education committee, Ms. Spellings offered a staunch defense of the department’s practices and its oversight of the student loan industry.



Read more: http://www.nytimes.com/2007/04/18/us/18loans.html?_r=1&hp&oref=slogin

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Representative George Miller, Democrat of California and chairman of the House education committee, said last night, “I am pleased that the secretary has belatedly taken some steps to address these fundamental privacy issues. However, it is long past time for the department to step up to the plate and vigorously investigate both the extent of lenders’ misuse of the student loan database and the exploitation for profit of federal programs” for student aid.