Home Main Higher One’s “regulatory issues” highlight the need for transparency

Higher One’s “regulatory issues” highlight the need for transparency


By Andrew Gregg
Staff writer

Higher One, previously the bank of choice for Cuesta’s disbursal of financial aid refunds, was forced to pay over $31 million in fees after it was found guilty by the Federal Deposit Insurance Corporation to have deceived students into setting up accounts.

This type of predatory, dishonest, and undemocratic practice is exactly why we need to scrutinize the decisions that Cuesta makes, and pay close attention to the companies it partners with.

And in this case we need to ask ourselves: Is a third party really necessary?

Chances are that many students already have a bank account when they enter college. If Cuesta is capable of handling financial aid disbursement itself, it should. We are students who are pursuing an education, and financial aid is vital to that pursuit. We aren’t targets for deceptive banks who want to reel us in, and we shouldn’t be treated as such. In fact, the purpose of our education should be to help us clearly understand the world so that we can responsibly and successfully participate in it. Deception and opacity undermine the very principles that are the foundation not only of education, but of democracy itself.

While Higher One’s replacement, BankMobile, may not have hidden fees or a deceptive campaign, its method of disbursement is poor. In my case, I waited for a “refund selection kit”–an envelop with a passcode in it–for over three weeks before I realized it wasn’t coming. It only took one Google search to show me that I wasn’t the only BankMobile customer left hanging. For whatever reason, BankMobile did not send refund information to students who needed it. It represents an extraordinary level of incompetence to mishandle something as important as a student’s financial aid.

The good news is that Cuesta’s financial aid office can email you the passcode you need immediately to receive your refund, making the wait for snail mail from BankMobile more frustrating. Let’s also stop and admire the irony that BankMobile, which markets itself as a digital banking service, is relying on paper mail in the age of email.

But the issue runs deeper than complaining about administrative headaches. In the case of Higher One, students were ripped off. They were deceived into believing that they had no choice, and as a result, they didn’t know what their options were. And what most of us find out when we attend college is that the cliche turns out to be true: knowledge is, in fact, power. The aim of deception, misleading information, and obfuscation, is disempowerment. Knowledgeable citizens are empowered citizens.

We, not only as students, but as citizens, should demand more transparency of the businesses and governments who want to control our lives–whether they’re local or multinational, state or federal. We should be the ones who set the agenda, and we should be in control of making our own choices. And we should be intolerant of obfuscation and of the corporations that want to mislead us.

If we cannot understand the information in our world, we will be unaware of the choices we are capable of making in it. The only choices we are aware of, in that case, are the ones that are presented to us by the people who want to profit at our expense–people who have a tremendous incentive to make sure that we don’t quite understand what we’re getting ourselves into. It’s our responsibility to make sure that we do.