Following a sale of 400,000 shares of stock by the chairman of the board of a major student loan corporation just before its stock prices dipped, two Congressional committees have initiated an investigation into communications between the White House, Education Department, and the Sallie Mae Corporation. One nongovernmental analyst told RAW STORY that the situation was "reminiscent of Martha Stewart."
Mutliple news sources reported last week that Sallie Mae Corporation Chairman Albert Lord (pictured above) had sold 400,000 shares of his stock in the nation's largest student loan provider on Thursday, Feb. 1, and Friday, Feb. 2. The following Monday, Feb. 5, the federal government released its Education budget, which included a substantial cut in federal subsidies for aid providers.
Sallie Mae's stock price, which closed on Friday the 2nd at $46.46, fell to $42.37 on Monday the 5th. The sale before the roll out of the federal education budget saved Lord more than $2.5 million.
"This is reminiscent of Martha Stewart," said Michael Dannenberg, Director of the Education Policy Program at the New America Foundation, who also produces the Higher Ed Watch blog.
"The sale of 400,000 shares is an irregular sale by Mr. Lord," he added. "I don't know if there's fire behind the smoke, but there's certainly smoke." . . . .