Sallie Mae reaches legal settlement with New York

NEW YORK (Reuters) - The New York attorney general's office said on Wednesday that SLM Corp. SLM.N, better known as Sallie Mae, agreed to pay $2 million to settle an investigation into financial arrangements it was accused of making with U.S. colleges and universities.

The largest U.S. student loan company also agreed to change some of its business practices, the attorney general's office said. The $2 million will be paid into a fund to help educate college-bound students.

The settlement stemmed from a broad investigation by Andrew Cuomo's office into financial arrangements between a number of lenders and financial aid officials at schools. The probe found that loan companies offered payments and perks to college officials to gain a place on their preferred lender lists, Cuomo's office said in a statement.

According to the settlement, SLM denied having broken the law.

SLM spokesman Tom Joyce said, "We're happy to put this matter behind us."

(Additional reporting by Sarah Coffey)