Nonprofit Student-Loan Groups Come Under Review
July 19, 2007 | Read Time: 1 minute
Nonprofit student lenders have come under Congressional scrutiny as the chairman of the House education committee asked the Government Accountability Office to investigate the organizations, reports The Washington Post.
“Nonprofit student lenders enjoy special benefits, such as exemption from federal income taxes,” Rep. George Miller, Democrat of California, said in a statement. “In exchange, they must honor their charitable mission, which is to help financially strapped students pay for college. When they stray from that mission, they shouldn’t enjoy any special benefits.”
The Post reported this week on nonprofit lender EduCap and its longtime executive, Catherine B. Reynolds, noting that the organization owned a $30-million airplane and paid Ms. Reynolds $1-million annual compensation.
EduCap denies any impropriety.
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