From MPR News (link)

Colleges' bank deals saddle students with big fees

More than two out of five U.S. higher-education students -- more than 9 million people -- attend schools that have deals with financial companies, says the report, written by the U.S. Public Interest Research Group Higher Education Fund. 

Unfortunately for the U of M subject of the original AP report, "The Campus Debit Card Trap" uses as an illustration a dodgy promotion from guess where?

Source: (downloadable pdf)

And of course the U's U-card does not escape USPIRG notice: 

Source: (downloadable pdf)

As this report drily notes: 

On December 31, 2011, the bank held $274.3 million in campus deposits. TCF has a 25-year naming rights agreement with the University of Minnesota to sponsor its on-campus football stadium, “TCF Bank Stadium,” which opened
in 2009.

and:

At TCF Bank,which partners with schools including the University of Minnesota, a $28 daily continuing overdraft fee is assessed for each day an account is overdrawn, for up to 14 days.

Bluestem Prairie, a blog that concentrates on new media for greater Minnesota, notes that cushy credit card deals for banks and not so cushy for students are not limited to the University of Minnesota. 

Devil in USPIRG debit card report details: 

How should MNSCU students answer to Higher One?

Yesterday, MPR picked up an Associated Press article, Colleges' bank deals saddle students with big fees which reviewed the finding of The Campus Debit Card Trap, a report issued Wednesday by the US PIRG Education Fund. 

The AP article cites a TCF arrangement with the University of Minnesota that's related to naming rights to the Gophers' stadium ... But the flagship school and local bank TCF aren't the only ones with a partnership.

A review by Bluestem Prairie revealed that MCTC, Central Lakes College, Century College, Dakota County Technical College, Hennepin Technical College, Inver Hills Community College, Lake Superior College, North Hennepin Community College, St. Paul College and Metropolitan State all have deals with the debit card company at the center of the report: Higher One.

A list of MNSCU campus Higher One ATM machines is located here, and the menu of individual Higher One campuses is found here.

So what's the problem with the arrangement? 

Programs like Higher One's shift the cost of handing out financial aid money from universities, which no longer have to print and mail checks, to fee-paying students, said Rich Williams, the report's lead author.

"For decades, student aid was distributed without fees," Williams said. "Now bank middlemen are making out like bandits using campus cards to siphon off millions of student aid dollars."

Students can opt out of the programs and choose direct deposit or paper checks to receive their college aid, but relatively few do. The cards and accounts are marketed aggressively using college letterhead and websites carrying the endorsement of colleges. Higher One also warns students that it will take extra days if they choose direct deposit or a paper check.

This seems to be accurate. Century College, for example, has posted a FAQ pdf for the Century Choice Card. The headnote reads:

Century College has partnered with Higher One, a financial services company focused solely on higher education, to offer faster delivery of refunds to students. Higher One will help bring this method for receiving refunds via the Century Choice Card Debit MasterCard®. The Century Choice Card will be your key to faster refunds and increased choice for receiving your Financial Aid or school refunds, including the preferred Easy Refunds method.

Someone needs to look into this...