A r c h i v e d  I n f o r m a t i o n

   FOR RELEASE                 Contact: Jane Glickman (202) 401-1307    October 12, 1994                  Stephanie Babyak (202) 401-2311

EDUCATION DEPARTMENT ANNOUNCES RENEWED FOCUS ON DIRECT LENDING

U.S. Education Secretary Richard W. Riley today announced a plan to strengthen the Department's efforts in the transition to direct lending.

Riley announced that Leo Kornfeld, currently deputy assistant secretary for student financial aid programs in the Office of Postsecondary Education, will be named senior advisor to the Secretary for direct lending.

As a deputy assistant secretary, Kornfeld managed all the federal student grant and loan programs in addition to supervising the transition from the Federal Family Education Loan Program to the new direct loan program under which the federal government, rather than private lenders, issues loans to students.

As senior advisor to the Secretary, Kornfeld will devote himself solely to the transition to the new direct loan program. He will have responsibility for the Federal Direct Student Loan Program and related areas of the student loan programs, such as oversight of the new computerized financial aid delivery system, guaranty agencies, and debt collection.

"This change underscores the importance of the direct lending program," Riley said, "because it brings that program closer to the Office of the Secretary while we are working through the transition to a system where the federal government provides college loans to students." Kornfeld has extensive experience in the public and private sectors in information services and in the past year has successfully begun the process of designing the new direct lending program.

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