Cease and desist: Grade gambling website sparks student privacy concerns

At least five universities have sent cease-and-desist letters to a student grade gambling website, saying the site violates student privacy and University policies.

Ultrinsic Motivator allows students to gamble on personal grade improvement. To place a bet, students hand over grades and schedules to Ultrinsic, which uses an algorithm to create a line on which students place money.

While the organization could be a way to financially motivate students to perform better academically, some schools argue the website violates student their conduct policies.

Indiana University associate general counsel Beth Cate said there were two legal issues surrounding Ultrinsic: students giving away passcodes that access grades, finances and other personal student information, and the website misleading students to think Ultrinsic is endorsed by the school.

“It allows Ultrinsic access to quite a lot of student data, which the students probably would not realize they are doing,” Cate said.

Cate said four other schools — George Washington University, Texas State, North Carolina State and Oregon State — joined Indiana in asking the site to disallow student use. According to the schools, Ultrinsic has neither responded to the letters nor changed the website’s wording.

“I think they have spent a lot of time on issues such as, ‘is this gambling,'” Cate said. “But this information data security issue is the one we care about a lot.”

According to Ultrinsic, students have the option to email or send in an official transcript instead of giving their passcodes. Cate said from her understanding students had to give their passcodes, which students use as a universal form of identification.

Ultrinsic told CNBC that last year there were 600 participants from two schools — New York University and University of Pennsylvania— but numbers from this year have yet to be released. The website currently lists 36 participating universities.

“It violates the school policy but I don’t think it implicates FERPA from our standpoint, but at the same time FERPA does not entitle Ultrinsic to these records,” Cate said.

Student Press Law Center attorney Frank LoMonte agreed with Cate, saying citing Ultrinsic with a Family Educational Rights and Privacy Act violation would be an egregious use of the law.

“FERPA only forbids the school itself from giving out confidential information,” LoMonte said. “A student can always give out the information to whoever they choose.”

Cate said if Ultrinsic does not cooperate with her school she will go to regulatory authorities, such as the Federal Trade Commission or the state attorney general’s office. She expects other universities will follow suit.

An Ultrinsic spokesman declined to comment about the letters.