August 16, 2007

Study Abroad – the new focus of influence into perks?

Posted in Student Loan News at 8:30 AM by Joe From Boston


Here’s an article that, if true, makes my blood boil. I studied abroad twice – once during my undergraduate degree, where I studied abroad in Kathmandu, Nepal; secondly for my graduate degree- I did the whole thing at King’s College London in England.

I firmly believe that all students should study abroad. You learn so much about yourself and about others. Being exposed to viewpoints that differ from your own and those of your family is a very important part of growing up, as everyone in this world of ours is different.

Anything that tarnishes study-abroad or that might make people think twice about going just makes me mad.

Study Abroad Is New Focus of Inquiry Into Perks

By DIANA JEAN SCHEMO, Published: August 16, 2007

WASHINGTON, Aug. 15 — New York’s attorney general is opening an inquiry into the relationships between universities and providers of study abroad, delivering subpoenas to five providers on Wednesday with more to come, a senior lawyer in the office said.

The lawyer, Benjamin Lawsky, deputy counselor in the office of Attorney General Andrew M. Cuomo, said the inquiry was focusing on whether cash incentives and other perks that study-abroad agencies give universities influence their decisions about where students may study. Critics contend that the practices, rarely disclosed and largely unknown, limit study-abroad options and drive up their price.

The subpoenas went to major players in the field, including at least one, the Institute for Study Abroad at Butler University, that offers colleges cash rebates in exchange for exclusive agreements that restrict students to the institute’s programs in a given region.

The others are the American Institute for Foreign Study; the Institute for the International Education of Students; the Center for Education Abroad at Arcadia University; and the Danish Institute for Study Abroad, affiliated with the University of Copenhagen.

The investigation follows disclosures in The New York Times that providers of study abroad are offering colleges rebates, free and subsidized travel, unpaid seats on advisory boards, help with back-office services and marketing stipends. In some cases, perks are tied to the number of students universities send to a given agency’s program.

Mr. Lawsky said the inquiry also grew out of the office’s look at similar practices in the student loan industry. He said the office was examining a variety of university practices with vendors, including those involving food services, student insurance and textbook sales. The loan investigation has so far cost lenders and universities some $20 million, in contributions to an education fund for student borrowers and compensation for students who overpaid lenders.

“As our investigation continues to expand,” Mr. Lawsky said, “we are finding that more and more vendors who do business on campus are there because of the cozy relationships they have developed with the schools. The question is whether those relationships help the schools at the expense of students.”

The subpoenas ask for documents, including agreements between providers and universities, and lists of university officials who sit on advisory boards.

Hours before they began arriving at the offices of providers, the major industry trade group for international educators, Nafsa: the Association of International Educators, announced creation of a task force to examine relationships between universities and study-abroad advisers, and to jump start the writing of guidelines, a step the industry has been struggling with for years.

Also at stake for scores of universities and providers of study abroad is $80 million a year in subsidies for study abroad that Congress is considering as part of a larger effort to increase the number of students studying abroad to one million a year from the current level of about 205,000.

David Larsen, executive director of the Arcadia program, said he could not comment on the nonprofit’s business practices before speaking to a lawyer. “The university wants to obviously be responsive,” Mr. Larsen said, “but this is strange water for us.”

David Gray, chairman of the board of the Institute for Study Abroad at Butler, said the institute had not yet received the subpoena and so could not comment.

Mary Dwyer, president of Institute for International Education of Students in Chicago, a consortium of 165 universities, said, “I.E.S. has done nothing wrong,” and would cooperate “to the extent required by law.”

The American Institute for Foreign Study and the Danish Institute for Study Abroad did not comment.

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2 Comments »

  1. Carl Madison said,

    Studying abroad is important! People need to wake up.

  2. […] Original post by moniqueleonard […]


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