Audit Critiques U.S. Oversight of Lenders

April 30, 2009

The U.S. Education Department's inspector general on Wednesday released the latest in a series of highly critical audits of the department's oversight of lenders and guarantee agencies in the Federal Family Education Loan Program. The audit critiques the performance of the department's Federal Student Aid office, saying that it provided inadequate oversight of lenders, loan servicers and guarantors and allowed potential conflicts of interest to exist in some of its key oversight positions, among numerous findings. The audit also maintains that the department failed to respond quickly and fully to previous critical audits; department officials responded that they planned to take additional actions "in the near future."

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