Truth From Harvard's Trust-Busters

IMAGINE you go to the Coop this afternoon to buy a textbook. When you give the clerk your credit card, he suddenly calls Harvard Book Store and Wordsworth to ask about your credit limit.

When you ask why, he explains that your limit is the same at all the stores, which, by the way, have agreed to charge the same prices for all their books. Meanwhile, the bookstores trade information about customers' accounts with each other, and the clerks make money trading the data.

Sound suspicious? Now imagine that the police are investigating these book-stores for alleged price-fixing. You might want to ask for your money back.

THE above example sheds light on practices at Harvard and a score of other colleges and universities. Just put the top schools of the Northeast in place of the booksellers, and the federal government in place of the police.

This summer, the U.S. Justice Department announced a full-scale investigation of the University and about 20 other schools for alleged price-fixing of tuition and financial aid awards dating back to the 1950s.

The charges, based upon federal antitrust statutes, raise the spectre of collusion and the abuse of power--intentional or not--by some of the nation's most respected institutions.

What's more, a Wesleyan student last week filed similar charges against a group of schools, including Harvard. If he turns his case into a class action suit and wins, many students could be awarded damages for being overcharged. That could mean millions of dollars in your pockets and in mine.

BUT the matter is critical to students not just because of a possible refund, but because it raises a fundamental issue for the liberal academies: trust.

Take Harvard. This week it was learned that University admissions officers were three of the four owners of a company that sold students' collated financial aid data to the schools under investigation.

This company, called Student Aid Services (SAS), was run by Dean of Admissions and Financial Aid William R. Fitzsimmons and two senior aides, Assistant Dean Warren C. Reed and Director of Financial Aid James S. Miller. It was formed with the explicit approval of the Harvard administration in 1983.

Obviously, this company will be scrutinized by the government, which must decide if information-sharing by a select group of schools violates the principles of a free market. But what is especially troubling is how the University acted toward this firm.

By its own admission, Harvard had been a key player in the exchange of student financial information since the 1950s, to the point of volunteering its own officers' time for the private company--SAS--commissioned to collate the data.

But why did Harvard, a non-profit institution, endorse SAS, a for-profit company, especially when the University's own officers are the ones making a profit? And while Harvard insists the deans observed all University conflict-of-interest regulations, how can this be reconciled with the fact that these deans could not possibly have gained their SAS posts--for which they were compensated on an hourly basis--without their direct ties to the University?

Indeed, what are the University's conflict-of-interest requirements? These are questions that must be answered.

BUT instead of answering these questions, it seems Harvard is trying to blur the details of its involvement with SAS. Grant the University's case that shared financial data prevents "bidding wars" for top students, and grant that SAS provides a necessary service to schools.

Then why did Dean Fitzsimmons resign from SAS four days after media reports pinpointed the company's existence and publicized the government probe? And in doing so transfer the business' legal address from Fitzsimmons' Weston, Mass. home to Reed's?

And why, the day before the news article appeared, did SAS hurriedly file six years' worth of late disclosure forms to the state of Massachusetts?

IN order to clear the atmosphere of confusion, Harvard owes the community answers to these questions. First, what was SAS' precise relationship to the schools under investigation for alleged tuition and finanical aid-fixing?

Next, why is it not a conflict of interest for Harvard officials to sell data--apparently obtained through their Harvard posts and processed on Harvard equipment--back to the University and other schools?

Finally, in the wider scope of the investigation, what is Harvard's role among the targeted colleges since it seems to have played a primary role in the sharing of information?

These answers will not concern only Justice Department investigators or students who may find an unexpected tuition windfall. They should be of concern to all members of the Harvard community, especially the administrators.