NYU, I Love You But You’re Literally Led by a Predatory Student Lender

William Berkley: Chair of NYU’s Board of Trustees, profiteer of predatory student loans

Dear NYU,

Today is the day we part ways. You see, I am graduating, and while I anticipate our paths will on occasion cross again, this moment signifies a defining change in our relationship.

As such, I wanted to take stock of what this university has meant to me. It is here I have forged so many friendships, broadened my academic horizons, and truly grown in this incredible city we call home.

But through all of this there has been one issue I have had trouble seeing past: the Chair of NYU’s Board of Trustees, William Berkley, literally headed the Board of a predatory student lending company while simultaneously sitting on the Board of NYU. Kind of weird, don’t you think?

For those unfamiliar, the Board of Trustees is the highest decision making body of NYU. They appoint our president, approve our budget, and set our tuition.

In fairness, I should flesh out the context of Berkley’s tenure. The recession in 2008 made times tough for a lot of people: students, parents, the unemployed, and, of course, predatory student lenders. In particular Berkley’s company, First Marblehead, saw a huge drop in their market price.

That’s why, under Berkley’s helm, First Marblehead lobbied congress against a bill to expand access to low-interest rate federal student loans at the height of the recession in order to force students to turn to private high-interest rate alternatives. The average rate for a First Marblehead student loan: 11%.

Further, under Berkley’s leadership, First Marblehead was investigated by the state of New York for deceptive lending practices and conflicts between private lenders and universities.

You may be wondering what this has to do with NYU. Interestingly enough, Berkley joined the Board of NYU the same year he joined the Board of First Marblehead. And even more interestingly, NYU contracted with First Marblehead during Berkley’s tenure on both boards to provide high-interest rate loans to international students ineligible for low-interest rate federal loans.

This of course all exists against the backdrop of a school routinely graduating classes with more collective debt that any other non-profit college in the country. Of course, as NYU has long insisted this is because of the endowment size and not the universally hated multi-billion dollar expansion plan. But hey, who can be sure?

Now I’m sure there is a perfectly reasonable explanation for this. That is why when I had the opportunity to ask NYU President Andrew Hamilton about this in a town hall I made sure to take advantage of the opportunity. Video below:

How compelling.

To wrap this up, it has been a real privilege to attend this university. It is in that spirit that I have fought over the past 4 years, with some success, to make this university more accessible to more people. It truly is a shame that ill-advised policies pushed by poorly selected leadership keep us from fully realizing this goal.

Small measures taken to increase affordability might help address the periphery of the problem, but they fail to take on the fundamental issue that plagues this university: not all, but far too many of those responsible for governing this university do so with little concern for the interests of its students.

I have long considered NYU to be a bit of a fixer upper. It seems reasonable to me that we could not spend billions of dollars on an expansion plan that people hate, not routinely graduate classes with monstrous amounts of debt, not be led by a predatory student lender, not have Trump advisers calling the shots at our university, not build a campus in another country using slave labor, not put the person who built such campus with slave labor on our Board, not give our former president an $800,000 annual pension, and still be “in and of the city”.

But hey, that’s just one man’s opinion. Do with it what you will.

Best wishes,

Drew Weber
NYU College of Arts and Sciences, Class of 2017