‘Expert’ on student loans was fake

Drew Cloud has been occasionally quoted as one of the leading “experts” on student loans.

Today, it has been revealed he’s fake. There’s no such person.

It took the Chronicle of Higher Education to reveal that the person who pitched student loan stories to news organizations and offered to do interviews by email, was a made-up character by the website — The Student Loan Report.

The Chronicle also revealed the website was actually run by a student loan refinancing company.

Ethics, anyone?

Cloud may no longer appear on his own site, but his footprint in the wider world remains. He was quoted by a number of media outlets this year in connection with a survey finding by The Student Loan Report that one in five students had used money from their student loans to invest in digital currencies. Experts in the field told The Chronicle that the study’s opaque methodology raised concerns.

Cloud has often appeared on financial-advice sites, either as a guest writer or as the subject of an interview. In those cases, he doesn’t mention where he attended college, but he does mention that he, too, had taken out student loans.

When people reached out to Cloud for his expertise on student debt, he often suggested that they refinance their loans.

Nate Matherson, the person who actually runs the refinance company, posts an “apology” for the deception:

(1) We never disclosed that “Drew Cloud” was a pen name that represented a group of us writing these posts. I really regret that. We are proud of our personal backgrounds and where they have brought us today. We should’ve chosen to be clear about who was authoring the posts. We have made a change on the site, effective immediately, to use each author’s real name for every post. We will also retroactively notate posts by Drew Cloud.

(2) We have always worked to keep editorial separation between The Student Loan Report and our other site, LendEDU.com, which is our main business. However, there have been nine Student Loan Report articles that mention LendEDU. We now realize that we should’ve had a disclosure that the sites were owned by the same company.

The doubts about Cloud appeared to have surfaced a month ago when “he” issued a survey about student loan recipients buying bitcoins with their money and was quoted by Fox News, CNBC, and Inside Higher Ed.

  • Mike Worcester

    I consider myself fortunate that my student loan debt was manageable and paid off some time ago. For too many it is not and won’t be for years to come. Thw quote I often use is that student loan debt is a modern version of indentured servitude. Harsh? Perhaps. Real? For sure.

    • I think a lot of people also don’t know that up to $17,500 of student loans can be forgiven by working for a non-profit organization (forgiven after 120 payments).

      • BJ

        After 10 years $1,750 per year. Will that cover the accrued interest for someone with a debt of $100,000?

        • Jim in RF

          My back of the envelope fig-rin, too. Better than nothing, but $17k is chump change in this game.

          • The average student loan debt is $37,000. I’m thinking if $17k of that is “chump change” for someone with a student loan, there’s no real reason for me to be concerned about student loan debt.

          • My son’s loans are well over $100k.

            /He’s a doctor though…

          • I wonder if there are programs that will wipe out doctors’ student loans in exchange for working in communities without doctors. Like Northern Exposure.

          • I loved that show…and he IS working for a non-profit out in Seattle.

          • Jay Sieling

            There are programs that do this. And there are areas that will offer load payment as part of a package to recruit physicians/providers to certain areas. Some of it may be as a signing bonus, some of it may be a full payout, or a certain $ amount that is significant. In exchange, the contract would be guaranteed service for 3-5 years or similar agreement.

          • 212944

            “Average” is not the same as “median” though.

            And when “average” is used, it is often up to the reader to understand that “average” is for those WITH student loans, not all students.

            That said, the debt burden many students and families need to take on for a two- or four-year degree these days is horrifying.

          • I”m not sure I understand the point. Mine is that 17k isn’t chump change.

          • 212944

            No doubt, $17k is huge.

            My point is that most articles through around something like “the average student loan debt is $37k.”

            First, “average” is not the most accurate measure. Median is a more accurate measure and from my reading, the few articles that cite median student debt instead of average show that it is below $37k (by $10k or so, last I could find numbers).

            Second, even when using “average student debt” that tends to be among those with student debt but the writers don’t specifically spell that out and many readers infer that is across all students, not just those with debt.

            Student debt load is a huge issue and needs to be fixed, IMO. But it is easier with a more accurate grasp of the issue.

          • Pick a number that represents what a typical student would be facing in loans. What is it?

          • 212944

            Pew reports the median student loan debt across all borrowers is about $17k, in an August report. But that is using the entire population, not those just or recently graduating. In their research, Pew shows that fewer than 40% of those 18-to-29 have outstanding student debt:

            http://www.pewresearch.org/fact-tank/2017/08/24/5-facts-about-student-loans/

      • jon

        My sister wiped out the principle on her student loans by working as a special ed teacher in an underperforming school district… Think it took 4-5 years for the principle to be gone, and she had to pay the interest on it during that time…

      • The $17,500 figure refers to Teacher Loan Forgiveness, which is different than the Public Service Loan Forgiveness program (working for the government or a 501(c)(3) full-time while making 120 payments in an income-driven repayment plan).

        • So it forgives the entire loan after 120 payments? Even better.

          • It forgives the remaining loan balance after 120 payments.

            It is possible for income-driven repayment plans to yield a zero monthly payment if the borrower is living under 150% of the poverty line, and that $0 payment counts as a payment. So, for those borrowers, it would forgive the entire loan.

    • Jerry

      Student loan debt (along with employment-linked healthcare) is a huge disincentive to entrepreneurship. You would think with all the lip service paid to “job creators”, something more would be done to alleviate it.

  • A-man

    It shows how desperate news sources can be for expert opinions to help a story.

    • Gary F

      Not that Google/Bing doesn’t have it biases and flaws, but a quick Google or Bing on a source could eliminate many of these problems.

      • How would that have worked in this case?

        • Gary F

          Now the search engines are full of hits.

          Did he appear on financial TV shows? What’s his LinkedIn page look like? Industry organizations, profiles, lots of stuff.

  • Guest

    This was NOT an oversight, this was knowing a lending company doing this has no credibility to “advise” or promote.

  • jon

    100 years ago we as a country agreed that secondary education (high school) was something that we needed to provide children with for the country to remain competitive on a global scale.

    Today we are competing against european countries where free college isn’t unheard of… and India where a year’s tution runs a few hundred dollars, a year instead a few tens of thousands in the US…

    We are loosing on a global scale because of a lack of cheap education.

    I say Bring on the free college… tax businesses to fund it, because they are going to be the ones benefiting from having workers with a college degree, and not having loads of debt they need to make money to pay off… (though it would still be nice if we paid people money… like enough to live on.)

  • NG

    Honestly, doesn’t surprise me. Businesses are there to make money. As long as they don’t get caught, they’ll try it. “Business ethics” was a running joke where I went to college. “You take it so you can learn how to get around it.”

  • AL287

    >>The doubts about Cloud appeared to have surfaced a month ago when “he” issued a survey about student loan recipients buying bitcoins with their money and was quoted by Fox News, CNBC, and Inside Higher Ed.<<

    Don't major news organizations vet their sources anymore or do the news organizations listed above just delight in misleading the public?

    I'll answer my own question. It sells advertising.

    • That’s not accurate at all. News orgs routinely vet their sources. In this case the “source” (source isn’t really a good word. An “expert” fleshing out a story isn’t really a source) was non-existent. I take as a matter of reasonable faith, I think, that you’re real, for instance. Or that people with whom I exchange emails looking for more information are real. This is less about vetting and more about fraud.

      Also, most newsrooms couldn’t possibly care any less about advertisers or advertising.