Tuesday, March 20, 2007

BIG SURPRISE - Jeff Fortenberry Supports Nelnet's $300 Million Swindle

by Kyle Michaelis
There was a bit of a delay in processing, but this March 9th Lincoln Journal-Star article should be of interest to anyone who believes corporations (and the politicians who protect them) should be held accountable for committing fraud against the American taxpayer:
The U.S. Department of Education is under fire from members of Congress for its decision to allow Lincoln student loan company Nelnet to keep $278 million in profits earned from a disputed loan subsidy.

Two different groups in Congress sent letters this week to Education Secretary Margaret Spellings asking her to better explain the department’s January settlement with Nelnet. One group of seven Republican and three Democrats called for Spellings to consider rescinding the deal.

The settlement allowed Nelnet to keep the about $278 million it earned from a government subsidy that guaranteed a 9.5 percent return on certain loans, even though the department’s Inspector General recommended that Nelnet pay back most of the money....

The first letter to Spellings, dated Monday, from seven Republicans and three Democrats called the settlement “irresponsible” and said it is setting precedent that “will encourage further abuse by lenders in the Federal Family Education Loan program”....

None of Nebraska’s three representatives signed either letter.

In the last election cycle, Nelnet was First District Rep. Jeff Fortenberry’s biggest financial contributor, at $26,000, according to the Center for Responsive Politics.

Fortenberry, a Lincoln Republican, said the decision on the Nelnet case was Spellings’ to make, not Congress’s.

“However, the congressman respects the concerns of members of Congress and welcomes any additional information regarding the secretary’s decision-making process,” Fortenberry spokesman Josh Moenning said.

The two letters asking asking that both the Dept. of Education and Nelnet actually be held accountable to the American taxpayer can be read here:
10 Democrats on the House Education and Labor Committee

Bipartisan group of 7 Republican and 3 Democratic Representatives

The decision "was Spellings' to make" - can you believe that is Jeff Fortenberry's response? He "respects the concerns" of those who actually think Congress has a role in holding American corporations accountable when they rip-off almost $300 million from taxpayers, but he personally thinks Nelnet should get away with it scot-free.

I suppose that shouldn't come as much of a surprise considering that Nelnet was the largest contributor to his 2006 campaign and the largest contributor to the House Republicans' Campaign Committee. No wonder that Fortenberry was named to the Campus Progress Hall of Shame for being such a lackey for student lenders against students' interests.

For some perspective, Nelnet directly contributed $26,000 to Fortenbery's campaign. For that investment, they seem to have bought his complicity to their walking away with $278 million of the American people's money. That's a return of more than $10,000 for every dollar spent - though, of course, Fortenberry's was only one voice of the many Nelnet tried to buy in the last election.

A small price to pay and probably a sound investment when you've got politicians like Fortenberry eager to play along.

Then again, none of Nebraka's Republican Representatives had the decency to stand up for enforcement of the law and fiscal discipline by asking that Nelnet be held accountable. And, they never will - at least, not until they themselves are reminded that they are accountable not to the Tom DeLays, George Bush's, and Nelnets of the world but to the voters and taxpayers of Nebraska, who have just been screwed royally on the Timid Trio's watch.

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