Nelnet Pays and Plays

Nelnet, a student loan provider, issued a press release stating that "[t]hrough a voluntary letter of agreement with Nebraska Attorney General Jon Bruning, Nelnet pledges to adopt the Nelnet Student Loan Code of Conduct, post a copy of a review of the company’s business practices on its Web site, and commit $1 million to help educate students and families on how to plan and pay for their education." (See also Wall Street Jrl here)  The Code of Conduct, which may likely become a model for the rest of the industry, has ten points.  The headings of each of these points are:

I. Prohibition of Certain Remuneration to Institutions of Higher Education / Revenue Sharing Prohibition

II. Prohibition of Certain Remuneration to Higher Education Employees / Gift and Trip Prohibition

III. Limitations on Lender Advisory Boards / Advisory Board Compensation Rules

IV. Limitations on Staffing of Financial Aid Offices

V. Prohibition on Use of Opportunity Loans

VI. Maintenance of Borrower Benefits

VII. Full Disclosure of Sales of Loans to Another Lender

VIII. Disclosure at the Request of Institutions of Higher Education

IX. Private Education loans

X. Preferred Lender Lists

The press release emphasizes that there was self disclosure in this case.

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