Rep. George Miller, D-Calif., the chairman of the House Education and Labor Committee, introduced a bill last week aimed at barring private lenders from offering gifts or similar incentives to colleges that agree to promote their loans.
The proposed Student Loan Sunshine Act, introduced in the House on Feb. 8, would prohibit lenders from giving gifts to college employees and would require them to disclose the terms of their arrangements with colleges.
Many colleges maintain “preferred-lender lists” to help direct their students toward sources of loans. To get on some colleges’ lists, lenders have offered colleges services or products, including software or help in operating their financial-aid offices. They have also dangled other incentives, such as trips to exotic locations for college administrators.
