Loan inquiry sidelines three

San Diego Business Journal, April 16, 2007 by Mike Allen

Loan Inquiry Sidelines Three: Three top executives of Student Loan Xpress, a San Diego-based student loan firm, were put on a leave of absence in response to a recent investigation into alleged misdeeds involving the sale of stock and the provision of gifts to college financial aid officers.

Student Loan Xpress Chairman Robert DeRose, Chief Executive Officer Mike Shaut and President Fabrizio Balestri were placed on indefinite leave, announced the company's parent, CIT Group, based in Livingston, N.J.

An investigation by New York Attorney General Andrew Cuomo revealed last week that financial aid officers at several colleges received stock and gifts in return for steering students to various student lenders, including Student Loan Xpress.

SLX is a subsidiary of Education Lending Group Inc., which was started by DeRose in San Diego, and sold to CIT in 2005.

CIT said it is taking the investigation seriously and is conducting its own review of the situation.

Cuomo's office said last week that student loan officers from three colleges, Columbia University, the University of Texas, and the University of Southern California, owned thousands of dollars of stock issued by Education Lending Group.