The University of Wisconsin-Milwaukee director of financial aid resigned from an advisory board of a student loan company Tuesday after the school discovered colleges were receiving financial kickbacks from the loan company.

Jane Hojan-Clark, the director of financial aid at UWM, sat on the advisory council of Student Loan Xpress, a company that has been under recent scrutiny since New York's attorney general began investigating the practices of student loan companies.

Last week, The New York Times reported financial aid administrators at Columbia University, the University of Texas and the University of Southern California held stock in Student Loan Xpress while the company was on the universities' preferred lender lists.

Clark said in her resignation letter to Student Loan Xpress she was "shocked and surprised by recent media reports of allegedly inappropriate conduct by other Student Loan Xpress Advisory Council members."

Clark added she — as well as other financial aid directors — does not own stock in Student Loan Xpress or any other private lender.

But UWM Provost Rita Cheng said the university will still use Student Loan Xpress as a preferred lender because it is one of the best services for student and parents.

Susan Fischer, financial aid director at UW-Madison, said Clark originally joined the advisory board of Student Loan Xpress to advocate for students' needs.

Yet Fischer said, under the current situation, it seems what Hojan-Clark did was the right decision to make for herself and UWM.

"She did nothing wrong," Fischer said. "Knowing what she knows now about the stock options offered to members of the board, I applaud her for [stepping down]."

Fischer said she is confident that if Clark had known of some of the practices that were going on, she would not have accepted the position from the beginning.

"Had she been aware, she wouldn't have joined," Fischer said.

— The Associated Press contributed to this report.