[Oasfaa] Ethics - The Debate Rages On

[DanGHolt at aol.com]

Colleagues:
 I want to commend Cheryl for her candor and reflection on this topic  of 
interest and concern. For all of us, the implications are far ranging.   For all 
of us, the value that we bring to the student college experience is why  we 
are in our chosen professions.  Please read on.
Dan

From:  Cheryl  Warmann  
_cwarmann at oakton.edu_ (mailto:cwarmann at oakton.edu)  
 
I hope you'll take the time to read my thoughts about one 
of our  current legislative issues.  Please tell me how 
your institution is  planning to make changes, if any.  I'd 
like to collate the responses  and send a master list of 
ideas out to help all our association  members.  
Thanks!  -Cheryl
 
Ethics—The Debate Rages On
 
Cheryl Warmann
MASFAA Professional Development Chair
Oakton Community  College
Des Plaines, Illinois
 
As I reflect on my years working in the financial aid 
profession, I  wonder if anyone could have foreseen the 
issues that challenge us now.   The collapse of Enron 
precipitated greater scrutiny of all accounting  controls 
and business ethics. The College’s accounting firm now is  
required to ask questions to our publicly elected Board 
members,  administrators, and personnel involved in 
handling revenue about fraud and  the propensity of fraud 
to be committed by someone at the institution. There  are 
many more questions, from auditors, about how funds are 
managed and  how individuals and offices maintain 
appropriate checks and balances.  
 
This trend failed to prepare me for the current questions 
related to  ethics and choice of lenders for institutions 
participating in the Federal  Family Educational Loan 
(FFEL) program or certifying alternative/private  loans.  
However, as the institution has adjusted to the additional  
attention our auditors pay to fraud prevention, we also 
will make  changes to help the public feel confident in our 
business  relationships.
 
Recently our office conducted a self assessment that 
included reviewing  the National Association of Student 
Financial Aid Administrator’s Statement  of Ethical 
Principals.  Our office had an animated conversation about  
point #11—“Commit to the highest level of ethical behavior 
and refrain  from conflict of interest or the perception 
thereof.”  
 
Some office staff were shocked and outraged that anyone 
might think we  perform our duties without rising to high 
standards.  Yet, each day, we  all develop perceptions of 
public officials, pro-athletes, and Hollywood  stars—
whether or not we know the complete situation.  Our  
profession’s “15 minutes of fame” is hardly glamorous and 
has  unfortunately only brought additional scrutiny to 
institutional and lender  business relationships.  At the 
moment this oversight is  uncomfortable—it challenges us to 
think a little more carefully about why  particular 
relationships benefit students at our institution.
 

Once I passed my surprise, anger, and a little sadness at 
the  additional examination, I realized that this is an 
opportunity for our  office – and our profession – to help 
our students and parents better  understand why particular 
business practices exist and that we want to  provide 
options that will help them with financial planning and 
securing  the education they seek.  Sound daunting?  
Perhaps, a  little.  
 
As I look at the proposed language regarding prohibited 
inducements,  preferred lenders, and the Sunshine Act, 
clearly there are parts I would  like to change.  
Colleagues question the unfairness of so many “shalls  and 
shoulds” for FFEL participants versus Direct Loan  
participants.  I encourage my colleagues to ask the tough 
questions  and to make the legislation stronger and more 
effective.  
 
In the end, though, I want to use this as an opportunity 
to tell  students and parents that we have spent time 
researching lender practices,  borrower benefits, and 
lender services, and explain what we have  learned.  We 
will spend more time trying to determine which lenders  
will help our institution manage our default rate. 
 
I expect that our front line staff will use this as an 
opportunity to  talk more about financial planning and 
provide financial consumer  information.  Will it be easy? 
Of course not.  Will we miss the  chocolate? Absolutely!  
In the end, however, the students will benefit,  and that 
is truly what matters.

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