NEW YORK - New York Attorney General Andrew Cuomo is widening his investigation into the student loan industry to include the direct marketing practices of certain companies and lenders.

Thursday, Cuomo announced he has served subpoenas on 33 companies and lenders, seeking information on any misleading or deceptive tactics they may have used when soliciting loans to young consumers.

"The student loan industry is a very complex and confusing marketplace, and as students try to navigate its murky waters to get the best loan at the best terms, the last thing they need are sharks baiting them with glossy promotions and deceptive offers," Cuomo said. "Students should be wary of such marketing and not allow it to deflect them from careful consideration of the merits of a company's loan offering."

Formerly, Cuomo's investigation focused on alleged inappropriate relationships between lenders and schools. He alleged that Education Finance Partners, against whom he filed his first lawsuit and with whom he eventually settled, was put on schools' "preferred lender" lists because it offered a cut of its profit to those schools. EFP has since settled those allegations.

Eventually, he settled with dozens of colleges and universities, as well as each of the five largest student loan providers in the country -- Sallie Mae, Citibank, JP Morgan Chase and Bank of America. Each agreed to abide by Cuomo's College Loan Code of Conduct and paid a total of $9.5 million to a fund designed to educate future college students about their loan choices.

Some of the college loan marketers who received Cuomo's new round of subpoenaes are EduCap/Loan-to-Learn, Affinity Direct/Educational Direct and three direct-to-consumer brands of First Marblehead Corporation (Astrive Student Loans, Laurel Collegiate Student Loans and Monticello Student Loans).

"Our ongoing investigation of the student loan industry has now shifted focus to the aggressive, misleading and harmful tactics of many companies who market student loans directly to students and their parents," Cuomo said.

"Reforming the student loan industry requires investigation of all aspects of this market to ensure that one reform, like cleaning up preferred lender lists, is more than just a thumb in the dike causing the bad practices to shift to another area of the market. The practices we have found in the direct marketing of loans to students are surprisingly blatant and even involve some companies who portray themselves as arms of the federal government."

Cuomo says loan companies are becoming more aggressive in their quantity of direct mailings, telemarketing calls and Internet or television advertising.

He uses the example of American Student Loans Services, which claim to be from the Federal Student Loan Department, show an eagle insignia and advise students to protect their rights by calling the company, Cuomo said. He said the company is attempting to pretend to be the federal government.

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