WASHINGTON -- As many as 900 colleges are pushing students into using payment cards that carry hefty costs, sometimes even to get to their financial aid money, according to a report released Wednesday by a public interest group.
Colleges and banks rake in millions from the fees, often through secretive deals and sometimes in apparent violation of federal law, according to the report, an early copy of which was obtained by The Associated Press.
More than two out of five U.S. higher-education students -- more than 9 million people -- attend schools that have deals with financial companies, says the report, written by the U.S. Public Interest Research Group Higher Education Fund.
"For decades, student aid was distributed without fees," said Rich Williams, the report's lead author. "Now bank middlemen are making out like bandits using campus cards to siphon off millions of student aid dollars."
Programs like Higher One's shift the cost of handing out financial aid money from universities, which no longer have to print and mail checks, to fee-paying students, Williams said.