Brian McLane

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PARENTS AVOID STUDENT LOAN TRAP – SALLIE MAE VAMPIRES IDENTIFIED

January 30th, 2011 · 3 Comments · Social Commentary

Parents, start thinking about saving for your children’s college tuition as soon as they are born. You definitely don’t want to fall into the hands of SALLIE MAE.

The cost of a college education is rising faster than the cost of medical care and as much as three times as fast as consumer prices in general according to a recent story on MSNBC. Take a second (maybe a minute) to think about that. But that’s just the beginning of the price of admission.

First there was the Real Estate Crisis, then there was the banking crisis, now here is the Student Loan Crisis that people aren’t (yet), talking about. Americans now owe more on their student loans than they do on their credit cards — a debt fast approaching (music please), TAH DAH!!!! $1 trillion!!!!!

Even though there are no jobs and the unemployment rate is far higher than the powers that be would have you believe. And the reward? Two-thirds of American college students will graduate with a monstrous sized debt on which the scam is, they’ll be paying back just the interest for 20 or 30 years without ever making a dent in the prinipal. For the class of 2009, the average debt was $24,000. But in more instances than not, with no job, or by having to take a menial job just to get by, the student will have to quickly go into forebearance and the interest will accumulate to 35,000, 50,000 and more.

How are we supposed to get the economy going when many kids are going to start life in bankruptcy? Most student don’t even know or understand how much debt they have. Student loan defaults have doubled in the last five years, according to the U.S. Department of Education, and are now approaching nearly a quarter-million defaults a year.
The official student loan default rate, according to the government, is now seven percent. That rivals the default rate for credit cards (8.8 percent) and home mortgages (9.1 percent). Because the government is lending most of the money, every default leaves the taxpayers on the hook.

Many people have been paying Sallie Mae for 20 years or more. And when one tries to take advantage of the Government Sponsored IBR program instituted by Barack Obama in 2009, they are met with one denial after another due to some loop hole and, due to the voluminous amount of paperwork that needs to be filled out, and documentation to be provided, people give up.

The Obama Administration needs to hold Sallie Mae accountable for honoring IBR, deal with the banks that engage in predatory lending practices, and the colleges who accept students (even with stellar grades), who they know will not be able to pay back their student loans without debt securitization measures

Meanwhile, here is a list of the vipers, the financial vampires who are sucking the blood out of the students of this great country, and killing the American Dream for them in the name of profit.

Below is the Hall of Shame – The Corporate Loan Sharks at Sallie Mae responsible for keeping their heels on the collective neck of America’s Student Population. Here’s also a warning from Suze Orman about the looming Student Loan Crisis.

CONGRESS DOES NOTHING AS STUDENT LOAN CRISIS SET TO SLAM AMERICA

CONGRESS DOES NOTHING AS STUDENT LOAN CRISIS SET TO SLAM AMERICA

SALLIE MAE VAMPIRES Officers & Directors

Albert L. Lord – CEO
Total Compensation: $ 2.85 M
Albert L. Lord, Vice Chairman (since January 2008) and Chief Executive Officer (since December 2007), SLM Corporation. Chairman, SLM Corporation�March 2005 to January 2008, Vice Chairman and Chief Executive Officer�1997 to May 2005. President and principal shareholder, LCL Ltd., an investment and financial consulting firm�1994 to 1997. Executive Vice President and Chief Operating Officer, Student Loan Marketing Association�1990 to 1994, various officer positions�1981 to 1990. Director of Other Public Companies: BearingPoint, Inc., January 2003 until May 2009. Other Activities: Director, Children�s Choice Learning Centers, Inc. Mr. Lord�s more than 15-year history with the Company, mostly as CEO, and also as Chairman of the Board, enable him to bring to the Board the perspective of the Company�s chief executive.

John (Jack) F. Remondi – COO
Total Compensation: $ 2.04 M
John F. Remondi, Vice Chairman and Chief Financial Officer, SLM Corporation�January 2008 to present. Portfolio Manager, PAR Capital Management, Inc., a private equity firm�2005 to January 2008. Executive Vice President, SLM Corporation�2001 to 2005, Senior Vice President�1999 to 2001. Chief Financial Officer and Senior Vice President, Nellie Mae Corporation�1988 to 1999. Various finance positions, Bay Bank Boston�1984 to 1988. On January 4, 2011, the Company announced the appointment of John (Jack) Remondi to the newly-created position of President and Chief Operating Officer of SLM Corporation Immediately prior to this appointment, Mr. Remondi served as the Company�s Vice Chairman and Chief Financial Officer.

Jonathan C. Clark – CFO
Total Compensation: $ 814,268.00
Jonathan C. Clark, Executive Vice President and Treasurer, SLM Corporation�January 2009 to present, Senior Vice President and Treasurer�September 2008 to January 2009, Senior Vice President�March 2008 to September 2008. Managing Director, Credit Suisse Securities (USA) LLC, an investment bank�2000 to 2007. Director, Asset Finance Group, Prudential Securities, Inc.�1999 to 2000. President and Principal, SBG Industries, LLC�1993 to 1999. Appointment of Jonathan C. Clark as Chief Financial Officer. On January 18, 2011, the Company announced the appointment of Jonathan C. Clark to the position of Executive Vice President and Chief Financial Officer of SLM Corporation, Immediately prior to this appointment, Mr. Clark served as the Company�s Executive Vice President and Treasurer.

Laurent C. Lutz – General Counsel
Total Compensation: $ —
On January 4, 2011, the Company announced the appointment of Laurent C. Lutz as Executive Vice President and General Counsel. Mr. Lutz was most recently Chief Legal Officer and Secretary of BearingPoint, Inc.

John J. Hewes – Senior Executive VP
Total Compensation: $ 1.32 M
John J. Hewes, Senior Executive Vice President and Chief Lending Officer, SLM Corporation�January 2009 to present, Executive Vice President and Chief Lending Officer�September 2008 to January 2009, Executive Vice President and Chief Credit Officer�March 2008 to September 2008. Group Executive, Consumer Finance and Lending Business, MBNA America, a credit card company�1996 to 2007, various officer positions�1985 to 1996. Departure of Jack Hewes. John (Jack) Hewes, Senior Executive Vice President and Chief Lending Officer, is departing employment from the Company effective January 31, 2011.

Joseph A. DePaulo – Executive VP
Total Compensation: $ 691,619.00
Joseph A. DePaulo, Executive Vice President, SLM Corporation�March 2009 to present. Chief Executive Officer, Credit One Financial Solutions, a consumer lending company�2006 to 2009. Group Executive, US Card Business Development Operations, MBNA Corp., a credit card company�2005 to 2006, various officer positions�1992 to 2005.

Robert S. Autor – —
Total Compensation: $ 1.92 M

Frank C. Puleo – Director
Total Compensation: $ —
Frank C. Puleo, Attorney�2006 to present. Co-Chair, Global Finance Group, Milbank, Tweed, Hadley & McCloy LLP, a law firm�1995 to 2006, Partner�1978 to 2006. Directorships of Other Public Companies: Apollo Investment Company. Other Activities: Director, Commercial Industrial Finance Corp.; CMET Holdings, LLC; Syncora Capital Assurance Inc. Mr. Puleo�s background as a corporate and finance lawyer, enable him to bring analytical, legal and financial insights to the Board�s review of the Company�s strategies, financial disclosures, legal and regulatory compliance and other matters.

Michael E. Martin – Director
Total Compensation: $ —
Michael E. Martin, Managing Director, Co-Head of Financial Institutions Group, Warburg Pincus, LLC, April 2009 to present. President of Martin & Company Advisors, LLC, a private equity investment firm� January 2009 to March 2009. President, Brooklyn NY Holdings LLC, an asset and investment management firm�February 2006 to December 2009. Vice Chairman and Managing Director, UBS Investment Bank�April 2002 to 2006. Managing Director, Credit Suisse First Boston �2002. First Boston Corporation�August 1987 to 2002. Attorney, Wachtell, Lipton, Rosen and Katz�January 1983 to 1987. Clerk to Honorable Stephen Reinhardt, of the United States Court of Appeals for the Ninth Circuit. Directorships of Other Public Companies: BPW Acquisition Corp.; Primerica, Inc. (nominee). Other Activities: Director, Aeolus Re, Ltc. Mr. Martin�s experience in investment banking focused on the financial services industry brings valuable experience to the Board to oversee the Company�s finance and business strategies as well as other matters.

Barry Feierstein – —
Total Compensation: $ 1.11 M

Howard H. Newman – Director
Total Compensation: $ —
Howard H. Newman, President and Chief Executive Officer, Pine Brook Road Partners, LLC, a private equity firm�2006 to present. Vice Chairman and Senior Advisor, Warburg Pincus LLC, a private equity firm�1984 to 2006. Morgan Stanley & Co., 1974 to 1983. Directorships of Other Public Companies: Newfield Exploration Company. Other Activities: Director of several private companies; Advisory Committee, JEN Partners, LLC; Trustee, Salk Institute for Biological Studies. Mr. Newman�s extensive experience in investment banking and capital markets, enable him to bring valuable insights to the Board in the areas of finance and strategy, as well as other matters.

J. Terry Strange – Director
Total Compensation: $ —
J. Terry Strange, Various positions at KPMG, LLP 1968 to May 2002. Directorships of Other Public Companies: Group 1 Automotive, Inc.; New Jersey Resources Corp.; Newfield Exploration, Inc.; BearingPoint, Inc., until May 2009. Other Activities: Director, BBVA Compass Bancshares, Inc. Mr. Strange�s extensive experience in public accounting and directorships of other public companies provide the Board with financial and accounting expertise as well as skills to oversee governance and strategy, in addition to other matters.

Ann Torre Bates – Director
Total Compensation: $ —
Ann Torre Bates, Strategic and Financial Consultant�1998 to present. Executive Vice President, Chief Financial Officer and Treasurer, NHP Incorporated, a national real estate services firm�1995 to 1997. Vice President and Treasurer, US Airways�1991 to 1995, various finance positions�1998 to 1991.Directorships of Other Public Companies: Franklin Mutual Series, Franklin Mutual Recovery, Templeton Funds and Allied Capital Corporation. Ms. Bates has served in senior financial roles in public companies, and is a board member of public companies in the financial sector. Her experience in these roles enables her to bring valuable experience to the Board in overseeing the Company�s financial and business strategy, audit and internal controls functions, among other matters.

Dr. Barry A. Munitz – Director
Total Compensation: $ —
Barry A. Munitz, Trustee Professor, California State University, LA�2006 to present. Chair, California P-16 Council, an organization that develops strategies to improve education in the State of California�2005 to present. President and Chief Executive Officer, The J. Paul Getty Trust�1997 to 2006. Chancellor and Chief Executive Officer, California State University System�1991 to 1997. Other Activities: Fellow, The American Academy of Arts and Sciences; Member, Leeds Equity Partners Advisory Board; Broad Family Foundations; COTSEN Foundation. Dr. Munitz� experience in senior leadership roles, including CEO positions in higher education and the non-profit sector, enable him to bring a valuable perspective to the Board�s oversight of the Company�s strategy, planning and operations.

Barry Lawson Williams – Director
Total Compensation: $ —
Barry Lawson Williams, President, Williams Pacific Ventures, Inc., a consulting and investment company�1987 to present. Interim President and CEO, the American Management Association International�2000 to 2001. Bechtel Group, Managing Principal, Bechtel Investments, Inc.�1979 to 1987. Directorships of Other Public Companies: PG&E Corporation; CH2M Hill Companies; Northwestern Mutual Life Insurance Company; Simpson Manufacturing Co., Inc.; R.H. Donnelly & Company until January 2010. Other Activities: Trustee, American Conservatory Theater; American Management Association; Resources Legacy Foundation; Harvard Business School Alumni Association; African American Experience Fund; Chairman, Management Leadership for Tomorrow. Mr. Williams� experience leading his investment and consulting firm, combined with other leadership roles in business and service as a director of a number of public companies enables Mr. Williams to bring expertise to the Board in the areas of finance, governance, technology and business planning and strategy, among others.

A. Alexander Porter,Jr – Director
Total Compensation: $ —
A. Alexander Porter, Jr., Founder and Partner, Porter Orlin Inc. (formerly named Porter Felleman, Inc.), an investment management company�1976 to present. Directorships of Other Public Companies: Comverse Technology, Inc. Other Activities: Founder and Director, Distribution Technology, Inc.; Trustee, Davidson College; The John Simon Guggenheim Memorial Foundation; Queens University of Charlotte, North Carolina; Library of America. Mr. Porter�s experience in private equity investing and his board memberships in the higher education and non-profit sectors provide the Board with expertise in finance, governance and other matters.

Diane Suitt Gilleland – Director
Total Compensation: $ —
Diane Suitt Gilleland, Associate Professor of Higher Education, University of Arkansas, Little Rock�2003 to present. Deputy Director, Illinois Board of Higher Education�1999 to 2003. Senior Associate, Institute for Higher Education Policy�1998 to 1999. Senior Fellow, American Council on Education, Washington, DC�1997. Chief Executive Officer, Arkansas Department of Higher Education�1990 to 1997. Chief Finance Officer, Arkansas Department of Higher Education�1986 to 1990. Other Activities: Director, University of Arkansas at Pine Bluff Foundation, University of Arkansas Foundation Board. Ms. Gilleland�s intimate knowledge of higher education governance and finance, from a university and government perspective, enable her to bring valuable insights to the Board on a variety of matters, including business strategy, product development and political and community relations.

Earl A. Goode – Director
Total Compensation: $ —
Earl A. Goode, Chief of Staff to the Governor of Indiana�November 2006 to present, Deputy Chief of Staff to the Governor of Indiana�April 2006 to November 2006. Commissioner, Department of Administration, State of Indiana�January 2005 to April 2006. Chairman, Indiana Sports Company�2001 to 2006. President, GTE Information Services and GTE Directories Company�1994 to 2000, President, GTE Telephone Operations North and East�1990 to 1994, President, GTE Telephone Company of the Southwest�1988 to 1990. Other Activities: Trustee, Georgetown College. Mr. Goode has held several leadership positions in business services and operations. This experience, combined with his involvement in the state political process, enable him to contribute to the Board�s oversight of the Company�s operations and its political strategy, among other things.

Ronald F. Hunt – Director
Total Compensation: $ —
Ronald F. Hunt, Attorney�1990 to present. Chairman, National Student Clearinghouse�1997 to 2004. Executive Vice President and General Counsel, Student Loan Marketing Association�1984 to 1990, various officer positions�1973 to 1984. Other Activities: Chairman, Warren Wilson College Board of Trustees. Ron Hunt�s extensive and deep involvement with the student loan industry and his legal background enable him to bring to the Board, a valuable perspective on the Company�s operations and strategy.

Steven L. Shapiro – Director
Total Compensation: $ —
Steven L. Shapiro, Certified Public Accountant and Personal Financial Specialist, Alloy, Silverstein, Shapiro, Adams, Mulford, Cicalese, Wilson & Co., an accounting firm, Chairman�1995 to present, various positions�1960 to present. Other Activities: Director, MetLife Bank; Member, Rutgers University Executive Advisory Council, American Institute of Certified Public Accountants, New Jersey and Pennsylvania Societies of CPAs; Trustee, Virtua Health and Hospital Foundation Board. Mr. Shapiro�s leadership role and experience in the accounting field, and his bank and other board positions enable him to bring to the Board skills to oversee matters relating to the Company�s business strategies and planning, audit of the Company�s financial statements, risks and controls, and other matters.

William M. Diefenderfer,III – Director
Total Compensation: $ —
William M. Diefenderfer, III, Partner, Diefenderfer, Hoover, Boyle & Wood, a law firm, Pittsburgh, PA�1991 to present. Chief Executive Officer and President, enumerate Solutions, Inc., a privately owned technology company�2000 to 2002. Treasurer and Chief Financial Officer, Icarus Aircraft, Inc., a privately-owned aviation technology company�1992 to 1996. Deputy Director of the Office of Management and Budget�1989 to 1991.Directorships of Other Public Companies: Chairman, U-Store-It Trust. Mr. Diefenderfer�s legal background combined with his involvement in the executive branch of government and his leadership roles in business, bring valuable experience to the Board in overseeing, among other things, political and financial strategy and business operations.

Wolfgang Schoellkopf – Director
Total Compensation: $ —
Wolfgang Schoellkopf, Managing Partner, Lykos Capital Management, LLC, a private equity management company�2003 to present. Chief Executive Officer, Bank Austria Group�s U.S. operations�2000 to 2001. Vice Chairman and Chief Financial Officer, First Fidelity Bancorporation�1990 to 1996. Executive Vice President and Treasurer, The Chase Manhattan Bank�1979 to 1988, various officer positions�1963 to 1988. Directorships of Other Public Companies: The Bank of N.T. Butterfield & Son Limited; BPW Acquisition Corp.; Santander Holdings USA. Other Activities: Director, UniCredit Cayman Islands, Ltd.; Wueba Versicherungs AG. Mr. Schoellkopf�s leadership roles in a broad range of banking industries, including commercial, consumer, investment and international, enable the Board to oversee all aspects of the Company�s financial operations, funding and liquidity strategies, business planning and other matters.

Anthony P. Terracciano – Chairman of the Board/Director
Total Compensation: $ —
Anthony P. Terracciano, Chairman, SLM Corporation�January 2008 to present. Chairman, Riggs National Company, a national bank holding company�2005. Vice Chairman, American Water Works Company Inc.�1998 to 2003. Chairman, Dime Bancorp�2000 to 2002. President, First Union Corporation (now Wachovia); Chairman and CEO, First Fidelity Bancorp; President Mellon Bank Corp.; Vice Chairman and Chief Financial Officer, Chase Manhattan Bank. Directorships of Other Public Companies: Sovereign Bank until February 2010; CIT Group Inc., January 2010 until February 2010. Other Activities: Trustee, Monmouth Medical Center. Mr. Terracciano has served in board leadership positions for numerous banks, and has held executive management positions in banking during his extensive career in the banking industry. With this background, Mr. Terracciano brings to the Board, unparalleled expertise in banking operations, consumer lending, capital markets, finance strategy and planning, asset quality, risk management, leadership and governance, among other matters.

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3 Comments so far ↓

  • Cathleen

    Hello. I took a loan out with Sallie Mae in 1998. They offered me a consolidation loan upon graduation which was promised to reduce the amount owed. I had a baby in 2002 and had to put my loan into deferment. After that point interest was capitalized and compounded. I have paid $500/mo. ever since but have seen no change in the principal balance nor the overall amount claimed due. It will never budge! I will have to die before it ends!!! This is discriminatory against women having babies, and criminal regardless. Despite autopay, they charge late fees and compound those too; they refuse to send an amortization schedule!!! Do not invest in Sallie Mae!!!!!!

  • admin

    It’s one of the biggest shames we have as a country. How we allow colleges to suck in students who can’t possibly pay tuition off with jobs paying 7 and 8 dollars an hour. Yet the colleges keep packing them in knowing this. I’ve had some success with outing other companies like Travelspot.US in this blog. Please let everyone you know to comment here if they have a Sallie Mae story. And spread the word that if anyone can get a video of any of the Presidential Candidates responding to a question about the Sallie Mae Student Loan Debt Crisis and Scheme that keeps students a slave to their interest payments fet mor years through forebearance, please let me know so I can post here, on my twitter and FB accounts, YouTube, etc.

  • Mary Ann Woodbury

    The debt is mine. The responsibility is mine. I do not deny that nor do I expect any special treatment. BUT: I am extremely angry about the complete lack of informed consent when I took out my loans and with what continues to be extremely misleading practices (current federal promissory note says “reasonable” collection fees will be charged if the loan goes into default – I was charged 24% sometime within three months of default, subsequently they are allowed 30%APR and then 40% APR collection fees — this is not reasonable and certainly not allowed on any other private or federal loan or credit). I am also very angry that congress has chosen to take away all creditor rights. I am angry that the new IBR is based solely on income; even the IRS sets a minimum standard of living before dictating repayment terms. I am angry that if I became available to pay off the loan that there is no possibility of negotiation; on the contrary the requirement is you pay 125% of the current balance. I have never head of any loan that could not be paid off for the current balance!

    Now that I am getting Social Security I am making small payments which have no impact on the loan. I asked the collection agency (an agency of the state of Michigan) to allow me to make income based payments. They have flat out refused saying they are under no legal obligation to do so. And, they are demanding that I sign an agreement to make a $507 monthly payment. I have fully disclosed my financial status and provided Income Tax Filings. How can I agree to do something that I cannot do?

    My inability to get a full time job anywhere in this country in 10 years is not my fault. I am 62. I was forced into retirement at 50. Surprise I could not get hired. I now understand the probability of ever finding a job for those that loose their jobs after age 50 is 50%. I exhausted my forebearances and deferment options and saw my loan go from around $30,000 in 2000 to $57,000 in 2011. In March 2011 it went into default. The balance is now well over $70,000. I have never been able to make payments on it. It was not a matter of choice. It was either make mortgage payments or student loan payments I could not do both. Going into foreclosure and student loan default by making partial payments to each was not an option. I had to have help to cover my mortgage. My mortgage payment is equal to or less than local rents.

    Until 2000 I was a responsible working middle class adult with a good credit rating, no bankruptcy history and paid my bills regularly. I now have a huge student loan debt that I would not have taken out in the first place if I had been informed about the real facts. I already had a bachelor’s and master’s degree. Had I been informed I would not have sought another degree just to keep my current job. Unfornutely I got cancer half way through my new student endeavor, was out of work for 11 months for treatment and then forced into retirement a year later. I have $5 in savings, no 401K, no IRA. The equity in my house won’t cover half my student loan. I lose on 2 of the 3 criteria that bankruptcy judges typically used in determining an “undue hardship” discharge.

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