Big Government Databases and Massive Corporate Corruption

If neo-cons have recently shown concern that black and brown children get a college education, you can be sure there is a reason that goes beyond altruism or social justice. You can be sure, in fact, that it had and has something to do the $60-something billion student loan business.

And why would the Bushies lobby for more and bigger student databases when they offer no oversight or protection from corporate raiders for the databases they already have? Were they not offering front-door access to the loan shark data miners who are their major campaign contributors. A full-fledged Congressional investigation is called for. From WaPo:

. . . . In August 2005, Cathy H. Lewis, the department's assistant inspector general, echoed those concerns [about corporate data mining] in a memo to Shaw that warned of security problems with the database and the lack of regular audit trails on the system.

Through a spokeswoman, Shaw declined to comment. Fontana did not return telephone calls.

After the warnings, inappropriate usage of the system seemed to decline, according to the department official who requested anonymity. But several months ago, top managers learned that the practice had resumed -- "a pattern that's very alarming," the official said.

Some senior education officials are advocating a temporary shutdown of access to the database until tighter security measures can be put in place, the official said. McLane confirmed that such deliberations are taking place.

It is not certain that the lenders that inappropriately used the database used information from it to market directly to students. Credit bureaus, for instance, also hold personal information on borrowers that can be used to solicit customers.

But department officials believe lenders are probably using the database for marketing, according to three current and former agency employees who spoke on condition of anonymity for fear of retribution. Some university financial aid administrators suspect loan companies are probably targeting students in the database who take out loans directly with the government, known as direct loans.

"The database is being misused by the industry to raid the direct loan portfolio," said Craig Munier, director of scholarships and financial aid at the University of Nebraska at Lincoln, who was at the meeting with Shaw. "It's certainly a misuse of the intended purpose of the information and was certainly not what we intended in the higher education community when we built" the database.

Some financial aid directors say abuse of the database would explain why some students who have taken out loans only directly with the government are deluged by up to a half-dozen solicitations a day from private loan companies.

"Our students are being inundated with marketing from consolidation companies," said O'Leary, of Stonehill College. "How else are the consolidation companies getting our students' information?"

Some financial aid administrators hope inquiries into the student loan industry will extend to the possible abuse of the database.

"We are hoping that a full congressional investigation can happen," said Hoover, the Denison aid director, who also met with Shaw. "And maybe then we will find out what's really happening."