Chairman Miller Launches Inquiry Into Potential Discriminatory Practices by Student Lenders

Testimony offered yesterday before the Senate Banking Committee raised questions about whether some student lenders are using inappropriate criteria to determine the loan terms and other borrower benefits they offer to students at different colleges -- that is, whether the lenders may in some cases be "redlining". Today, Chairman George Miller of the Education and Labor Committee, sent letters to the five largest student lenders requesting information to help determine whether the lenders offer less favorable terms to students at predominately minority colleges, such as Historically Black Colleges and Universities, than they offer to students at other four-year public and private colleges. Chairman Miller sent the letters to Sallie Mae, Wells Fargo, Bank of America, Citibank, and J.P. Morgan Chase.

A copy of the letter to Sallie Mae is below:

Charles Elliott (C.E.) Andrews

Chief Executive Officer

Sallie Mae Corporation

12061 Bluemont Way

Reston, VA 20190

Dear Mr. Andrews:

In light of disturbing testimony yesterday before the Senate Banking, Housing, and Urban Affairs Committee about the possibility of discriminatory practices (i.e., "redlining") in the student loan industry, I request information that will help this Committee determine whether Sallie Mae offers the same favorable terms to students at predominantly minority serving institutions compared with students at other four-year public and private institutions.

I respectfully request that Sallie Mae provide this Committee detailed information about the qualifying factors and criteria borrowers and schools must meet to obtain the best loan rates and other borrower benefits. Specifically, I request Sallie Mae data that expressly identifies the terms and conditions for its student borrowers, by school, participating in the Federal Family Education Loan Program (FFELP), the Sallie Mae private loan program or both. Because of the large number of students receiving Sallie Mae loans, I am limiting my initial request to information covering the last three years.

Given the seriousness of this issue, please produce the information requested within 5 days of receipt of this letter. I have enclosed specific instructions and definitions applicable to my request to assist with your response. Please coordinate the production of the information requested with Michael Zola, the Committee's Chief Investigative Counsel, at (202) XXX-XXXX.

Sincerely,

GEORGE MILLER

Chairman

cc: Senior Republican Member Howard "Buck" McKeon

Enclosure: Information Request Supplemental Instructions