Family Ethics: Admitting Former Clients to Graduate School

I am the director of a master's program in marriage and family counseling. An integral part of our admissions process is a personal interview During a recent interview, an applicant revealed that she had been in therapy with one of the faculty a few years ago. While we rejected the candidate for reasons unrelated to her being a former client, we became uncomfortable with the potential for exploitation and harm to the previous therapist-client relationship and decided that any faculty member could veto an applicant to protect previous counseling relationships and confidentiality. However, some faculty members weren't comfortable with this decision, and recently a potential applicant argued that the decision should be made by the candidate. What kind of ethical guidelines can help us deal with applicants who have been former clients of faculty?