HARTFORD, Conn., May 27 (UPI) -- Nine of 14 board members of a Connecticut student loan non-profit have resigned over a dispute on legal indemnity, the state Student Loan Foundation says.
The financially troubled nonprofit said Tuesday the mass resignation came after state legislators blocked a request by Connecticut Gov. M. Jodi Rell to provide legal indemnity for the volunteer board members, The Hartford Courant reported.
"It's unfortunate that it came to this, but the legislature was unwilling to give the directors of the Connecticut Student Loan Foundation the protections that the members of any other state board or commission enjoy," Rell spokesman Rich Harris said. "The foundation members understandably felt that they had no other recourse."
The board members said they wanted the indemnity as the foundation was poised to run out of money to administer, guarantee, finance and serve its $800 million in outstanding student loans, the newspaper said.
The Courant said Rell sacked six foundation appointees this year after auditors revealed it had handed out executive bonuses and spent thousands of dollars on parties and golf club memberships even while racking up multimillion-dollar deficits.
