Washington--Concluding a nearly two-year antitrust investigation by the Justice Department, the eight colleges and universities of the Ivy League last week agreed to stop sharing information on student financial aid.
The institutions chose to avoid a costly court battle with the Justice Department by signing a consent decree that calls for ending their practice of meeting to set financial-aid amounts for incoming freshmen.
The department filed a civil complaint last week against the eight Ivy League institutions and the Massachusetts Institute of Technology, alleging that they violated the Sherman Antitrust Act in conspir4ing to restrain prices by conferring on financial-aid packages.
Mit declined to sign the decree and could end up in court, Justice Department officials said.
“We do not believe that our practices violated the antitrust laws,” said Mark S. Wrighton, mit’s provost.
At the center of the investigation was the longtime practice by the Ivy League institutions and 15 other selective colleges and universities in the Northeast of meeting together each spring to jointly consider the financial-aid applications of approximately 10,000 students who were accepted by more than one of the schools.
This meeting, known as the “over8lap group,” was designed to develop matching financial-aid offers that would prevent the institutions from outbidding each other to lure the most desirable students.
“The defendants conspired to eliminate cost competition as a factor in choosing a college,” Attorney General Dick Thornburgh said in announcing the consent decree here on May 22.
Students may have been deprived of the opportunity to attend their school of choice because they did not receive as much aid as they might have without the “conspiracy,” the department said.
The Ivy League institutions--Brown University, Columbia Uniel10lversity, Cornell University, Dartmouth College, Harvard University, Princeton University, the University of Pennsylvania, and Yale University--promised they will no longer collude or conspire on financial aid, effectively putting an end to the overlap group.
They also promise no future collaboration on faculty salary increases or tuition increases.
Ivy League officials contend that the collaboration on financial aid was designed to route more aid to the neediest students.
Benno C. Schmidt Jr., president of Yale, said the disputed practices “served students and their families well."--mw
