Students across ITT Technical Institutes' campuses awoke Tuesday morning to emails saying they wouldn't be attending class anymore. After months of sanctions and years of investigations and lawsuits, ITT Educational Services -- the institution's parent company -- announced it was closing all of its campuses. We have had no right to pursue our right to due process, and this should be concerning to all Americans.
However, the U. Department of Education defended its actions that led to the closure of ITT, which had been a career college operator for 50 years. Under Secretary of Education Ted Mitchell in a phone call with reporters. It's to protect all students and taxpayers, and I have no doubt our decision to take action was the right one. The closure affects more than 40, students and 8, employees. As of Tuesday, ITT cut back its operations to about employees who will help students receive their records, facilitate transfers to other institutions and assist in other operations, Modany said, adding that students were being contacted and provided with a list of alternative institutions in their areas.
We're saddened and all the emotions you would expect to have," he said. Our focus is on our students and their families, and we'll do everything we can to mitigate the effects of what we believe was a preventable situation. The news comes nearly two weeks after the U.
Department of Education prohibited ITT from enrolling new students who use federal financial aid. The department also tightened its already enhanced oversight of the company, including a prohibition on ITT awarding raises, bonuses or severance packages to the company's executives. A letter of credit is collateral the government asks colleges to set aside when officials have concerns that an institution may be unable or unwilling to pay back money it owes the government.
There are very fundamental issues of institution integrity, financial stability, administrative capacity and their ability to meet federal and state financial aid administration requirements, so these are not small matters, these are matters that cut to the heart of the institution's ability to provide quality service to its students and to provide value to taxpayers in the Title IV program.
ITT had also been facing several state and federal investigations and legal actions, including lawsuits from the Consumer Financial Protection Bureau and the U.
Securities Exchange Commission. But it was ITT's issues with its accreditor that spurred the department to take its recent action. King Jr. Students were angry and bewildered. A cashier at Disneyland, Valdez lives with her parents to save money.
King said current or recently enrolled students could be eligible to have their student loan debt forgiven and might be able to transfer ITT credits to another school. It also has a special website for ITT students and is planning a series of webinars to help them figure out their options.
Students who were enrolled or had withdrawn from ITT within the last days have two options, Mitchell said. They could apply to have their federal student loans forgiven. Students also could try to transfer their ITT credits to another school. But if those credits are transferred to the same program of studies at another school, the loans for the ITT credits would not be eligible to be forgiven, Mitchell said. Any students who feel they were defrauded can apply to have their federal student loans forgiven, Mitchell said.
The organization is planning a clinic Thursday for low-income ITT students to explain their options, she said. Students can call to register. Education Department also prohibited ITT from awarding its executives any pay raises or bonuses. Current students, it said, could continue receiving federal grants and loans. Earlier in August, a group that accredits ITT found that the chain failed to meet several basic standards and was unlikely to comply in the future.
Lazarus: How a bite from a stray dog shows the sick state of U. Petersburg Times. ITT Technical Institute has been accused of fraudulent practices for over a decade. In , federal agents temporarily closed ITT Tech schools in eight states to investigate allegations of fraud. Since then, the company has fought securities fraud lawsuits from investors, whistle-blower suits from former employees, and complaints from state prosecutors and regulators, the DOE, and lawmakers.
According to the New York Times, complaints against ITT Tech included deceptive marketing; strong-arm recruitment tactics; misleading information about costs, courses, graduation and job placement rates; inflated enrollment numbers; bait-and-switch schemes; subpar instruction; and more.
Corinthian Colleges also abruptly shut their doors after allegations of deceptive acts in March. Each institution is different. To see updated developments for these sanctioned institutions click here. In an attempt to support the students caught suddenly without the ability to continue their studies at ITT Tech, the DOE has stepped in to offer next steps.
In a letter from Ted Mitchell, the secretary of education, students were provided two options:. As it stands, students taking option one may have to start over on their education to ensure their federal loan debt is completely forgiven.
This presents many students with a challenge since many nonprofit schools with regional accreditation are reluctant to accept unaccredited, or nationally accredited courses. The DOE has received thousands of emails and calls from students seeking guidance on how to move forward. CSU Global is working diligently to reach out to these students and support them as they map out their future goals. The landscape of education is changing with long established universities developing online models.
The Students Before Profits Act that spurred the recent investigation of for-profit universities, is hoping to reinforce quality education by increasing oversight.
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