It’s disappointing that it took a court order to get Secretary DeVos to begin providing debt relief to students," said U.S. Sen. Patty Murray. The U.S. Department of Education announced Thursday it would automatically cancel $150 million in student loans connected to...read more
Student loan debt is now the second highest consumer debt category - behind only mortgage debt - and higher than both credit cards and auto loans. According to Make Lemonade, there are more than 44 million borrowers who collectively owe $1.5 trillion in student loan...read more
Are you burdened with debt from ITT Technical Institute?
ITT Technical Institute was a for-profit technical institute. Founded in 1969 and with approximately 130 campuses in 38 states of the United States, ITT Tech was one of the largest for-profit educators in the US as of 2015. Starting in about 2004, ITT Tech came under fire for questionable practices, including allegations of high-pressure recruiting tactics, falsified paperwork, high rates of default on student loans for ITT Tech students, and inadequate educational standards. Following a series of state and Federal investigations, the US Department of Education prevented students from using federally guaranteed student loans at any ITT Tech location effective August 2016. All ITT Tech campuses were closed as of September 6, 2016, and on September 16, 2016, ITT Tech filed for bankruptcy. In 2018, ITT Tech’s trustee sued the US Department of Education and lenders that took advantage of low-income students, to help pay $1.5 billion in claims. Students who attended ITT Tech may be able to have their debt forgiven by applying to the US Department of Education for a borrower defense to repayment. However, US Secretary of Education Betsy Devos announced on July 25, 2018 that the borrower defense rule would be repealed and replaced with a stricter repayment policy starting July 1, 2019.
The for-profit industry is spiraling downward, which is great news for former students. Programs have now opened allowing students to find relief from their student loans obtained at these dishonest for-profit institutions. If you attended ITT Technical Institute, call (877) 515-0185 to see if you qualify for student loan forgiveness. We can also assist you with your private student loans.
ITT Technical, The Dream That Didn't Last
Students Fight Back
In August 1998, 15 former students alleged misrepresentation, fraud and concealment by ITT arising out of their recruitment and education at ITT campuses. In September 1998, ITT settled all of the claims.
Feds Raid Headquarters
On February 25, 2004, federal agents raided the company’s headquarters and ten of its campuses in Indiana, Texas, Virginia, Florida, Louisiana, Nevada, California and Oregon. The investigation negatively affected the company’s stock and triggered several class action lawsuits by investors.
Attorney General Gets Involved
In 2004 the Office of the Attorney General for the State of California (“CAG”) investigated ITT Technical Institutes in California. The CAG’s investigation was in response to actions filed against the company under the state and/or federal False Claims Acts alleging that ITT Tech falsified records relating to student attendance, grades and academic progress, falsified student grade point average calculations used to qualify students for financial aid under the State’s Cal Grant Program and retaliated against employees who may have complained about those alleged acts.
California Gets A Settlement
In October 2005, ITT agreed to pay $730,000 to settle a lawsuit with California in which employees alleged that it inflated students’ grade point averages so they qualified for more financial aid from the State of California.
Grade Inflation Gets ITT Caught
A February 2011 investigative report by WTMJ-TV in Milwaukee found evidence of widespread grade inflation at the school’s Milwaukee area location in Greenfield. In one instance, a student got 100% on a computer forensics assignment by emailing the professor a noodle recipe. The station believed this to be a way to increase federal student aid funding.
Predatory Lending Practices
In 2013, a complaint was filed against ESI and two ESI executive officers in US District Court for the Southern District of New York regarding securities. The Massachusetts Laborers’ Annuity Fund filed a similar complaint and the cases were consolidated. The Plumbers and Pipefitters National Pension Fund and Metropolitan Water Reclamation District Retirement Fund were the lead plaintiffs. Students continue to allege that private loans with JP Morgan Chase and other banks are predatory. In 2013 USA Today listed more than 50 ITT campuses as “red flag” schools because their student loan default rates were higher than their graduation rates.
Department of Education Increases Monitoring
On February 26, 2014, the Consumer Finance Protection Bureau (CFPB) sued ITT, alleging that they used high-pressure tactics to coerce students into high-interest private loans that were likely to end in default. ESI is also being investigated by at least a dozen state attorneys general for allegations of fraud and deceptive marketing. On October 19, 2015, the U.S. Department of Education announced that because of the company’s failure “to meet its fiduciary obligations,” it was being placed under “heightened cash monitoring”.
In a 2015 federal whistleblower lawsuit, a former ITT Tech dean of academic affairs alleged that the company (1) directed recruiters to use coercive tactics to pressure students into enrolling, (2) admitted students who were unable to succeed at the school, (3) unlawfully paid sales commissions to recruiters, and (4) lied to students about their financial obligations and transferability of ITT credits to other schools, and about the jobs students could expect to get after graduating.
In 2015, The California Department of Veterans Affairs (CalVet) temporarily ordered ITT Tech to stop enrolling new or returning students who fund their educations with GI Bill benefits. In 2015, the Securities and Exchange Commission announced fraud charges against ITT Educational Services Inc., its chief executive officer Kevin Modany, and its chief financial officer Daniel Fitzpatrick.
Beginning of The End
In 2016, Massachusetts Attorney General Maura Healey sued ITT Educational Services for allegedly “misleading and harassing students.” Breckinridge nurses also sued ITT Education for fraud. The following states issued subpoenas or Civil Investigative Demands against ITT Tech between the beginning of 2004 and the end of May 2014, under the authority of their consumer protection statutes: Arkansas, Arizona, Colorado, Connecticut, District of Columbia, Hawaii, Idaho, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, North Carolina, Oregon, Pennsylvania, Tennessee and Washington.
On August 25, 2016, the U.S. Department of Education banned ITT Tech from enrolling students who receive federal aid and at the same time doubled the surety funds that ITT Tech was required to have, and to produce those funds within 30 days. Stock markets reacted with a punishing 35% drop which triggered a halt in trading, raising concerns about whether ITT Educational would be able to survive this latest decision. On September 6, 2016, ITT Tech ceased operations and closed all of its locations, issuing a statement that attributed the closing to the Department of Education’s actions.
How Does It Work?
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One of our representatives will look at your loans and determine the best programs for you based on your specific case.
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