President of student loan guarantor placed on leave Head of USA Group was convicted of misdemeanor

March 06, 1997|By David Folkenflik | David Folkenflik,SUN STAFF

The president of the largest guarantor of student loans in the nation and Maryland has been placed on indefinite leave after the company's board was informed last weekend that he had been convicted of resisting arrest in January.

On Monday, the Fishers, Ind.-based USA Group put Roy A. Nicholson on administrative leave, the Indianapolis Star reported Tuesday. He had been convicted of a misdemeanor stemming from a late-night altercation Nov. 22 with an Indianapolis police officer.

USA Group officials would not speak for Nicholson, and he did not answer telephone calls to his home yesterday.

"Although this is a very unfortunate personal situation for Mr. Nicholson, it will not impact the service that USA Group and its affiliates provide to students, their families, colleges and universities in Maryland or anywhere else," spokesman Bob Murray said.

The "group" in USA Group is a family of college aid companies dominated by USA Funds, the guarantee agency. USA Group guarantees loans in nine states, including Maryland, and handles the paperwork for other guarantors in 11 states. Last year, the firm guaranteed $5 billion in college loans nationally and $217 million for students who were enrolled at Maryland campuses.

As The Sun reported on Sunday, USA Group has drawn fire from federal regulators and some members of Congress for the pay it gives to executives and for the profits it makes from the student loan business. Nicholson's compensation totaled $1.1 million for the year.

On Nov. 22, police allege, Nicholson was seen in the back of a minivan, partially clad and in an embrace with another person. When a police officer approached him, Nicholson fled toward a nearby canal, the report stated. Then Nicholson turned to confront the officer, who sprayed him with a chemical repellent.

Edward A. McCabe, the former chairman of the Student Loan Marketing Association and a longtime director of USA Group, has been named its acting chairman of the board, while Executive Vice President James C. Lintzenich will serve as its acting president and chief executive officer.

Pub Date: 3/06/97

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