Student Loan Blog : Las Vegas

State Colleges Cut Staff, Programs as Budgets Slashed

Student Loan Girl — Fri, 20 Mar 2009 18:32:00 GMT

Michael Crow, the president of Arizona State University who seven years ago promised to make ASU “The New American University” and to grow the school’s enrollment to 100,000 students by 2020, could see his plans go unfulfilled because of state budget cuts, reports The New York Times (“State Colleges Also Face Cuts in Ambitions,” March 17, 2009).

Since last June, ASU has lost $88 million in state funding, which amounts to 18 percent of the university’s base budget.

“The New American University has died; welcome to the Neutered American University,” the Arizona school’s student newspaper editorialized last month after ASU announced it would be eliminating more than 500 jobs, closing 48 programs and requiring remaining employees to take 10 to 15 days of unpaid leave this spring.

While ASU students said they believe school president Michael Crow is doing his best to protect them from further funding cuts, they also said the state’s budget cuts will negatively affect the quality of their education.

ASU Not Alone, Colleges Struggling Nationwide

Public colleges across the country are experiencing layoffs, salary freezes, and even enrollment reductions as they grapple with shrinking state funding in the current recession.

The University of Florida recently eliminated 430 faculty and staff positions, the University of Nevada, Las Vegas, recently laid off around 100 employees, and the University of Vermont has eliminated 16 positions, left 22 faculty positions vacant, and frozen the salaries of certain staff, The New York Times reports.

And California’s higher education system, which serves 3.3 million students — nearly 20 percent of college student nationwide — is among the nation’s college systems hardest hit by this recession. Both the University of California system and the California State University system have lost hundreds of millions of dollars in state funding and have been forced to shrink their enrollment numbers.

“What’s happening, everywhere, is what’s happening to Michael Crow,” said Jane Wellman, executive director of the Delta Project on Postsecondary Costs, Productivity and Accountability, an organization that studies college spending. “The trend line is states disinvesting in higher education.”

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Former Student Finance Corp CEO Gets 5 Years in Prison for Loan Fraud

Student Loan Girl — Thu, 12 Feb 2009 22:38:00 GMT

The former head of bankrupt Student Finance Corp. has been convicted of fraud — his second fraud conviction in two years — after he was found guilty of lying on loan documents used to secure a $25 million line of credit for the student loan company and to obtain $7 million in personal loans, reports The Delaware County Daily Times (“Radnor Businessman Gets 5 Years for Fraud,” Feb. 9, 2009).

According to David Weiss, acting U.S. attorney for the District of Delaware, former student loan executive Andrew Yao also fraudulently obtained millions of dollars in bank loans to purchase a private plane worth $4 million and to refinance his $3 million vacation home in Nantucket, Mass.

Yao has been sentenced to five years in prison and has been ordered to pay $12.5 million in restitution, Weiss said. In 2007, Yao was convicted of bankruptcy fraud after lying about giving almost $700,000 to his mistress, former Playboy centerfold Alexandria Karlsen Wolfe, and about gambling away $150,000 at two Las Vegas casinos.

In his most recent fraud conviction, Yao pleaded guilty to seven counts of making false statements to a financial institution, and one count each of mail fraud, wire fraud and engaging in an illegal monetary transaction. In addition, Yao is subject to criminal forfeiture of $1 million.

As part of the loan scheme, Yao hired an accountant to prepare fraudulent personal tax returns for himself and his corporation from the early 1990s up through 2002. These tax returns were different than the actual returns filed with the IRS, Weiss said, and in many cases, the returns overstated Yao’s income by several million dollars.

“The sentence imposed on Mr. Yao sends an important message to all those who would think about attacking our financial system through fraud,” Weiss said. “His false statements led to the loss of millions of dollars by financial institutions, losses that affected those institutions, their employees, their shareholders and the public.”

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More Rigorous Admissions Standards at Nevada Universities May Affect Minorities

Student Loan Girl — Tue, 17 Jun 2008 00:05:00 GMT

NAACP and ACLU officials warn that with the University of Nevada, Las Vegas, and the University of Nevada, Reno, increasing their minimum grade point average from 2.75 to 3.0, minority students may be discouraged from pursuing a higher education, according to an Associated Press article (“NAACP, ACLU Concerned About Tougher Admission Standards at Nevada Universities,” June 15, 2008).

Citing a report that showed a drop in enrollment among minority students the last time these schools raised their minimum GPA requirements, the two organizations have expressed concerned that this move may have a disproportional impact on minority students.

In 2006, the two universities increased the minimum GPA requirement from 2.5 to 2.75, which resulted in a 22-percent decrease in black student enrollment and a 50-percent drop in Native American and native Alaskan students at UNLV for that year, according to another Associated Press article (“Freshmen Enrollment Dips at Nevada Universities,” June 14, 2008). That same year, University of Nevada, Reno experienced a 10.6-percent decrease in Hispanic student enrollment.

University administrators claim that those students who meet the new, more rigorous standards will be better able to succeed in the classroom. High school students seeking admission to UNLV or the University of Nevada, Reno with low GPAs, will be able to apply with their SAT or ACT scores instead of their grades.

Students denied admission due to low GPAs may improve their academic performance at a state or community college prior to attending one of the two state universities.

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