A former financial aid director at Johns Hopkins University who cultivated a national reputation as a stickler for ethics accepted more than $130,000 from eight lending industry companies during her tenure, twice as much money as previously disclosed, according to documents and interviews.
In 18 years at Johns Hopkins, Ellen Frishberg advised the federal government on rules for officials dealing with the student loan industry and lectured peers on the need to avoid perceived conflicts of interest. "Appearance of impropriety is as important as impropriety itself," she said in a 2000 presentation to California aid administrators.
This month, Frishberg resigned after the university concluded that she failed to comply with ethics policies by accepting $65,000 from a lending company she had urged students to use.
But her financial ties to the industry were more extensive than Hopkins or Frishberg have publicly said, amounting to at least $133,695, according to hundreds of pages of financial records, contracts and e-mails The Washington Post obtained from Senate investigators.
The portrait of Frishberg that emerges -- a savvy businesswoman who worked at home as a $200-an-hour consultant and accepted free tickets from lenders to black-tie galas -- contrasts with her public profile as a loan company critic and student advocate. Lawmakers and consumer advocates say her case illustrates a troubling overlap between the $85 billion-a-year student loan industry and some university financial aid officials whom students have relied on for impartial guidance.
As Congress and the New York attorney general began to crack down on the industry this year, Frishberg privately lamented the new scrutiny of ties between lenders and university officials.
No more 'fun and games'
"This is no longer the fun and games we have come to know and love," Frishberg wrote in a March e-mail to executives at Campus Direct, a lender that paid her more than $13,000.
In her first public remarks on the controversy, Frishberg said that she had worked for lending companies but that she never viewed the arrangements as conflicts of interest. She said Johns Hopkins relied on the federal government as its primary lender. And Frishberg said the companies she did recommend offered students the best deal.
"I worked tirelessly for Johns Hopkins and its students and their parents," she wrote in an e-mail to The Post. "I have been vilified, I believe unfairly, in the media. I am no longer able to serve the students, parents and this University that I devoted much of my professional career to serving."
Sen. Edward M. Kennedy (D-Mass.), chairman of the education committee, which gathered the Frishberg documents during an investigation of the student loan business, said, "This situation underscores the need for industry-wide reform, which will restore students' trust." Kennedy has sponsored legislation to prevent conflicts of interest in university aid offices, a version of which the House overwhelmingly passed this month.
Frishberg said her supervisors at Johns Hopkins, a prestigious 131-year-old Baltimore university, encouraged her consulting work and approved at least one of her contracts with a loan company.
"Sounds like a win-win for you and Hopkins," William Conley, dean of enrollment and academic services, wrote in a 2006 e-mail to Frishberg after a university attorney reviewed her $3,000 contract with Student Loan Processors Inc.
Conley did not respond to a phone message seeking comment. Dennis O'Shea, a Johns Hopkins spokesman, said that the university allows outside consulting under certain circumstances but that Frishberg failed to disclose information that might show she was not following conflict-of-interest rules. O'Shea said the university found no evidence that students were harmed by Frishberg's actions.
Frishberg, 53, of Ellicott City, was responsible for helping students figure out how to afford a $44,000-a-year Hopkins undergraduate education. In Washington, she spoke out for the federal government's direct lending program -- a position at odds with industry groups -- and served on an Education Department committee that sought to draft conflict-of-interest rules for the loan industry.
Supplmenting her income?
Neither Frishberg nor the university would disclose her Johns Hopkins salary. Frishberg said she began consulting about a decade ago after a supervisor turned down her request for a raise but suggested she supplement her income with outside work.
At first, she consulted mainly for the U.S. Department of Education, which paid her more than $22,000, starting in 1998, and for American Express, which paid her $3,250 from 1997 to 2000, documents show.
Frishberg's consulting income rose after some American Express executives helped form a company, Student Loan Xpress. They offered her shares of discounted stock, which she declined in part because she could not afford them, Senate investigators said.
Instead, Student Loan Xpress agreed to pay more than $20,000 of her tuition at the University of Pennsylvania, where she began a program in 2002 to earn a doctorate in higher education management, documents show. Then, she began charging Student Loan Xpress $2,000 a month on homemade invoices for work on "strategic advisement, federal relations, media response, marketing consulting."
Put on 'preferred lender' list
Frishberg said most of her work for Student Loan Xpress involved speaking on the phone with four company employees about eight hours a month, according to investigators who interviewed her. Frishberg also told investigators that she made at least $62,870 from Student Loan Xpress; the university puts the total at about $65,000.
At the same time, Frishberg helped place the company on a "preferred lender" list at Johns Hopkins and recommended the company in a letter to the New School in New York. Some lawmakers have criticized preferred lender lists, but universities commonly use them to help students sift through thousands of borrowing options.
University data show that Student Loan Xpress has been the top private lender of federally backed loans to Johns Hopkins students for the past five years. Its loan volume at the university in some years has totaled more than $5 million.
In 2005, Frishberg pushed the university to designate the company as an exclusive provider in one lending program. But she added in a memo to school officials: "Full disclosure: I have served for 8 years on a school advisory group for American Express and now Student Loan Xpress. . . . We receive no compensation for our participation."
As a result, the university said, it chose another lender, Citibank, a decision Frishberg supported.
Frishberg also received $100 an hour as a consultant for a company called Global Student Loan Corp., which offered to hire her full time as a senior vice president, with an annual base salary of $110,000, if she left Johns Hopkins, documents show.
Expensive financing better than no financing?
In December, Frishberg persuaded the university's provost to sign a contract that would help Global and a partner, Wachovia, make loans to international students. "The downside is the cost to the students -- high fees, pretty high interest," she wrote in a memo. But she suggested "expensive financing" might be better than no financing.
In e-mails with lending company executives, Frishberg adopted an affectionate tone, referring to some as "my friend" and suggesting going out for drinks together. But she sought to keep her consulting agreements secret.
"I would appreciate your discretion to keep my involvement with Ed Direct as a consultant confidential," she wrote in a January e-mail to an executive at Campus Direct, which is affiliated with the lender Educational Direct.
People who know Frishberg say they are stunned by revelations about her connections to loan companies.
"Ellen always behaved as a student and public interest advocate," said Barmak Nassirian, a frequent critic of the loan industry at the American Association of Collegiate Registrars and Admissions Officers. "She is the last person I imagined would get implicated in this mess."
Allegations of impropriety
Nassirian, who described Frishberg as a close friend, attributed her actions to "bad judgment and normal human frailty" and said she should be recognized for her promotion of federal policies to help student borrowers.
When another friend asked Frishberg about allegations of impropriety against other aid administrators, Frishberg said they did not share her commitment to ethics. "I do serve on . . . some advisory boards -- kind of like the medical junkets the pharma companies offer -- we go to a resort for 3 days, and pay a nominal fee. But I still insist on best pricing and good service before I bring a loan to my students," she wrote in an e-mail. The new generation of administrators, she added, "just don't have the same moral center."
As scrutiny from Congress and New York Attorney General Andrew M. Cuomo (D) increased this year, Frishberg told her staff that she would need to approve any gifts from lenders because investigators have "put us all under a microscope."
"While we are a very ethical bunch, this is the time to be extra careful," she wrote in a March e-mail to her staff. "Thanks for indulging my paranoia."