Education Department official placed on leave

April 13, 2007
Education Department official placed on leave

WASHINGTON -- An Education Department official placed on leave over a potential conflict of interest in his management of the government's student loan program filed disclosure forms that raise questions about the department's oversight of its own employees.

The forms, released by the department late Thursday, show the official, Matteo Fontana, listed ownership in 2002 of stock in two companies that manage student loans: Direct III Marketing Inc. and Education Lending Group. In fact, the companies are the same; Direct III Marketing changed its name to Education Lending Group at about that time.

Fontana valued the stock in each in the range of $1,000 to $15,000. Department rules generally allow employees to work on matters affecting companies they own stock in so long as the amount does not exceed $15,000.

Fontana's disclosure for 2004 shows that on July 7 of that year, he sold common stock in a company listed only as EDLG worth $100,000 to $250,000, investing a like amount in a vacation home. EDLG is an abbreviation for Education Lending Group Inc.