School for scandal

By DAVID S. BERNSTEIN  |  August 27, 2008

Pinch and others in the area are also among those shown to have accepted free trips, meals, and entertainment for taking part in lending institutions’ advisory boards — a practice now being critically compared with the way pharmaceutical companies have long sought to influence doctors to prescribe their products.

To attend one meeting this past year, as a member of Citizens Bank’s education-finance advisory board, Pinch took a mid-February trip to Walt Disney World, where Citizens Bank picked up the tab for everything from the flight to the Mickey’s Chocolate Fondue (what’s with the chocolate?!) delivered to his room at the Disney Yacht Club Resort.

Michele Kosboth of Lasell College in Newton was on the same trip. A year earlier she was wined and dined in Philadelphia — and taken to a Phillies game in a luxury box — on a similar jaunt, where she was joined by Michael Wildeman of Northeastern University and Michelle Smith of Emerson.

Emerson fired Pinch within a week after Kennedy released his report on June 14. But observers ask: if schools can really police themselves as they claim, why didn’t Emerson discover and stop Pinch’s dealings when the scandal erupted in March? That’s when New York attorney general Andrew Cuomo drew national headlines with allegations of kick-back schemes and other arrangements at dozens of schools nationwide.

According to David Rosen, Emerson’s vice-president of public affairs, Pinch failed to disclose his financial arrangement with CFS to Emerson officials, even when interviewed by school counsel after the national scandal broke.

But Rosen concedes that the college’s lapse was also partly attributable to its lack of a formal conflict-of-interest policy guiding its staff’s outside employment. Nor could Emerson’s staff look to higher-education associations and governing bodies for guidance. Both Emerson and professional groups are only now hastily compiling conflict-of-interest ethics guidelines.

Not long ago, higher-ed professional associations were less than enthused about such codes of conduct. The National Association of Student Financial-Aid Administrators (NASFAA) — whose president initially blasted Cuomo for his investigation — worked on guidelines several years ago, but its board refused to adopt them, says Eileen O’Leary, director of student aid and finance at Stonehill College in Easton. She was on the committee that worked on them.

“I am very sad that our association didn’t take the lead on this issue with a code of conduct years ago,” says O’Leary. Looking back at the reluctance of the board, she now says, “I’m wondering if they did not protest too much.”

Code-o-rama
Now, in the wake of the national scandal, the NASFAA is promising to clean up the very abuses it previously chose to ignore. So is, among others, the National Association of Independent Colleges and Universities. “There are about a dozen [codes] under development,” says Rosen.

Many individual colleges across the country have quickly adopted guidelines, some working in regional groups, such as 11 Missouri colleges that voluntarily agreed to a code in April (with an attorney general’s investigation providing the impetus). Some lending institutions, including Nelnet, have even adopted their own codes.

Under pressure from state legislators, the Massachusetts Board of Higher Education has belatedly created a code of conduct for the state’s public colleges.

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