OUR VIEW: OU selling students out
OU has made an incredible amount of money with its credit card affinity agreement with Bank of America and Mid-First Bank, but at what cost to students?
Since the agreement took effect May 1, 2007, the university has made $8.8 million by releasing student contact information to banks. OU makes commission and royalties on all purchases made on the cards and when the bank acquires new members.
The original idea was to put that money toward student activities. Unless constructing and acquiring majestic buildings is a form of student activities, then the university has not stuck with the original terms of the agreement.
The money made off of this deal has not gone toward student activities. Rather, the bulk of it has gone to the Fred Jones Junior Museum of Art, which received $6 million from the agreement in the last year alone.
The Arezzo Monastery in Italy that OU purchased for a study-abroad program has received the second-biggest chunk of change from the agreement — $445,595. While that’s a far cry from $6 million, it’s still a significant amount.
And then there’s the nebulous “Other Institutional Commitments,” which university spokesman Chris Shilling refused to disclose, receiving $691,980.
While it generates millions of dollars — OU was guaranteed $12.1 million over 10 years, according to the terms of the agreement — it comes at an overlooked cost to students.
Many students receiving credit cards don’t know how to use them, and the OU administration only pays lip service to making sure its students will use the cards wisely.
Shilling said the university offers students educational outlets to help prevent credit-card abuse and poor money management.
This is news to us. Just what does OU offer in terms of financial literacy for students? The most significant offering we could find doing a simple search of “financial literacy” on search.ou.edu is an OU high school course called Personal Financial Literacy. However, this no longer exists seeing as the administration decided to quietly discontinue its OU high school courses this year.
Learning how to use credit cards and build credit can be beneficial for students, but the university needs to do its part to offer students programs or courses in this area. If there are financial literacy programs on campus, they need to be advertised. Right now, it seems like the administration could care less.
Allowing banks to target students can have serious consequences. In 1988 and 1997 two Oklahoma students committed suicide because of the crushing credit-card debt they acquired. While this happened before OU made its affinity agreement, many have pointed to these deaths as reasons why OU should be more transparent about its agreement, modify it or get rid of it completely.
More recently, student credit-card debt has increased. On average, students leave college with $3,000 in credit card debt, according to an April 2009 report by student loan provider Sallie Mae. That’s a 41-percent increase from 2004, according to the report, and this doesn’t even count debts accrued from student loans.
Students should be expected to take responsibility for their own actions, but the problem has grown to a point that the university must do more to protect the student’s interests. The administration should start by being more honest and transparent about its affinity agreement.
Right now, the agreement is hidden away. There is no mention of it on the OU website in its policy regarding the release of student information.
To keep their information from being released, students have to go through the trouble of filling out a request to withhold their information, an action that has strings attached as well. The university will release no information “verifying your attendance, withdrawal or graduation from the University” unless a student consents with a written request. So if there’s any benefit to allowing the university to release your information, you must acquiesce to allowing it to provide your information to the banks.
OU also makes sure to place the interests of the bank above students, as outlined in the agreement. If an open-records request is filed regarding the agreement, the contract states that the university will consult with the bank “on the advisability of taking legally available steps to resist or narrow” such requests. Why would OU try to block out open-records requests on the affinity agreement unless it knew how deceitful it really is?
If students knew how the university allows banks to target naive students with credit-card opportunities, people would likely call for change. But OU uses every loophole in the book to make sure students remain unaware so that its lucrative program can remain in place.
The student who killed herself in 1997 was Mitzi Pool, an 18-year-old freshman at the University of Central Oklahoma. She was found dead in her dorm room with credit card bills covering her bed.
To make sure this didn’t happen again, UCO banned banks from marketing credit cards on its campus and incorporated several sections of a personal-finance course into its general-education requirements.
While we don’t think banks ought to be completely banned from soliciting to students on campus, OU should be honest about its agreement and make it easier for students to withhold their contact information from being given to banks.
And the administration should definitely take a leaf out of UCO’s book and get serious about providing financial literacy courses to students. As suggested by the millions raised from the agreement, it’s not like OU couldn’t afford it.