Coverage: For-profit ITT Tech closes its doors

ITT Education Services Inc., a for-profit college, closed its locations on Tuesday after the federal government said the school could not enroll students using federal aid.

Kim Bellware of The Huffington Post had the news:

The website for the school, which was commonly known as ITT Technical Institute, says the institution had more than 138 campuses in 38 states and more than 40,000 students ― some of whom were slated to graduate this week.

All locations have been closed, the company said. The shutdown affects approximately 8,000 employees, ITT said in a statement.

The school had been the subject of several state and federal investigations, as well as lawsuits that alleged fraud, harassment as an enrollment tactic and predatory lending.

Students and faculty members have criticized the school by saying it aggressively enrolled students by making inflated promises about job prospects and the value of an ITT degree.

Michael Baston Jr., who graduated from ITT’s Milwaukee campus in 1998, said he wasn’t surprised by the announcement. Relatives had been ringing the warning bell about the school for years.

“My aunt had actually tried to warn me and my mom before I went there in ‘96: It wasn’t worth the money, that if I wanted to continue on, my credits wouldn’t transfer,” he said.

Robert Channick of the Chicago Tribune examined what may happen to its students:

King said ITT students interested in continuing their educations may be able to transfer their credits to another school. But he said doing so may limit their ability to have their outstanding federal loans discharged.

There are four ITT Tech campuses in Illinois: Arlington Heights, Oak Brook, Orland Park and Springfield.

One semester short of graduating with a degree in graphic arts, Robert Marques was outside the closed Orland Park ITT Tech campus Tuesday looking for information, and in the dark about his academic future.

“I don’t know yet what’s going to happen” said Marques, of Joliet, a former Marine who was attending ITT Tech on the GI Bill.

The recently renovated ITT Tech campus in Arlington Heights also was shuttered Tuesday. Jennifer Bakrins, an Arlington Heights therapist whose office is in the same building, said she was sympathetic to the school’s students.

“The school just went through a big undertaking, remodeling the building,” Bakrins said. “They even made a student lounge with a college atmosphere. A traditional college isn’t for everyone, and this place offered vocational training, so it’s a real shame.”

Michael Stratford and Kimberly Helford of Politico report its closing could cost taxpayers $500 million:

The collapse Tuesday of ITT Tech, a massive, publicly-traded for-profit education company with 130 campuses across the country, comes just 12 days after Obama’s Education Department imposed stringent new regulatory restrictions on the college chain. Taxpayers are now on the hook for nearly $500 million in federal loans that ITT students are eligible to have forgiven.

It was the most aggressive action yet by an administration that has long sparred with the for-profit education industry but had walked a delicate line in being sensitive to business interests while seeking to impose stronger consumer protections for students.

This is the second time in as many years that the crackdown has brought down one of the industry’s biggest players — and saddled taxpayers with potentially hundreds of millions in cleanup costs.

Students who attend a school that abruptly closes are eligible to ask for a “closed school discharge” of their loans. For years, some liberals have complained that big for-profit education companies were treated as if they were too big to fail by regulators, because the cost of forgiving loans from a large for-profit could be massive.

Read more: http://www.politico.com/story/2016/09/itt-tech-closes-its-doors-227765#ixzz4JWupaHVx
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