University Code of Conduct for Student Loans
Although the University of Michigan’s existing conflict of interest policies would already preclude the conduct prohibited by 34 C.F.R. § 668.14(b)(27),* for clarity, the University of Michigan hereby establishes, as an addendum to the Provost’s Office’s Conflict of Interest and Conflict of Commitment Policy for Staff ("Provost’s Staff COI/COC Policy"), this code of conduct in regards to private student loans.**
The responsibility for the administration of this code of conduct and its enforcement resides with the Provost of the University of Michigan.
This code of conduct is applicable to all officers, employees and agents of the University of Michigan and any affiliated organizations with responsibilities (directly or indirectly) with respect to private student loans. University officers, employees and agents subject to this policy are prohibited from doing any of the following, either on their own behalf or on behalf of the University:
- Participating in a revenue-sharing arrangement with any lender by which the lender pays a fee or provides other material benefits to the University or any officer, employee or agent subject to this policy in exchange for the University’s recommendation of that lender or its loan products;
- Soliciting or accepting gifts, including reimbursement of expenses or payment of expenses of a value greater than that set forth in the Provost’s Staff COI/COC Policy as requiring possible conflicts disclosure, from any lender, guarantor, or servicer that provides private education loans to students, unless the item or payment in question meets the exceptions set forth in 34 C.F.R. § 601.21(c)(2)(iii);
- Accepting from any lender or affiliate any fee, payment, or other financial benefit as compensation for any consulting arrangement or other services contract with or on behalf of a lender of private education loans, except that University officers, employees, or agents subject to this policy who do not work in the Office of Financial Aid may serve on a lender’s board of directors, provided that they recuse themselves from any board decisions relating to private education loans at the University;
- Directing borrowers to particular lenders or delaying loan certifications;
- Requesting or accepting from any lender any offer of funds to be used for private education loans in exchange for the University’s providing the lender with a specified number of, loan volume of, or preferred lender arrangement for, private education loans;
- Requesting or accepting any lender’s assistance with call center or Office of Financial Aid staffing, except that the University may request or accept from any lender (a) professional development training for financial aid administrators, educational counseling or other materials to provide to the University’s student borrowers (provided that such materials indicate the lender’s involvement in preparing or providing them), or (b) short-term, nonrecurring staffing assistance with financial aid-related functions during emergencies; and
- Receiving anything of value from any lender, other than reimbursement for reasonable expenses, in exchange for service on an advisory board, commission, or group established by a lender, guarantor, or group of lenders or guarantors.
Any employee who is offered any gift or monetary compensation from a lender should contact the Office of Financial Aid for clarification and guidance before responding favorably to that offer.
Should an employee subject to this policy inadvertently accept a gift or other type of monetary compensation from a lender, that employee must immediately notify the Department’s Director or Dean. The amount received, the name of the employee or agent, a brief description of the activity and the dates of the activity for which the expenses were paid or provided must be reported to the Department’s Director or Dean. The Executive Director of Financial Aid is responsible for reporting this information annually to the Secretary of the Department of Education.
The Executive Director of Financial Aid is responsible for notifying all officers, employees and agents of this requirement annually. This notification will be done via email in January of each year. In addition, this code of conduct will be published on the website of the Office of Financial Aid, as well as on the Provost’s Office website.
* This regulation requires all institutions that participate in the federal Title IV student loan programs to adopt a code of conduct that meets the requirements of 34 C.F.R. § 601.21.
** Because the University of Michigan does not participate in the FFEL Program, the regulation cited applies to the University only as its terms relate to private education loans. A list of private education loan lenders frequently used by our students may be found on the website of the Office of Financial Aid at https://finaid.umich.edu/private-education-loans. This is not an exhaustive list, as lenders in the area of private education loans change frequently.
Completed and reviewed 03/05/10