ITT Tech, once a well-respected for-profit college, is now embroiled in a major scandal. The school is accused of using deceptive practices to lure students into taking out loans to pay for their education, then providing them with a subpar education that left them unable to find jobs to repay their loans.
As a result, many students are now saddled with tens of thousands of dollars in debt, and the school is facing multiple lawsuits. This is a major blunder on the part of ITT Tech, and it remains to be seen how the school will recover from this scandal.
Looking at the way things are unfolding, the future does look bleak. Moreover, it showcases the hassles present in the current infrastructure. To learn more about the situation, glance over the following paragraphs.
Federal Loan
Former ITT Technical Institute students who still owe $3.9 billion in federal student loans to for-profit institutions must repay them via the country, according to the US Education Department. The government also said that DeVry University has been officially informed that it must pay $24 million in defense claims for the borrower.
The organization that administered ITT Technical Institute, ITT Educational Facilities Inc., declared in September 2016 that it had.
ITT Tech Scam in a Nutshell
The ITT Tech scam was a massive, years-long fraud perpetrated by the for-profit college chain ITT Tech. The scam defrauded tens of thousands of students and taxpayers out of billions of dollars, and ultimately led to the collapse of the company.
The scam worked like this: ITT Tech recruited students with false promises of well-paid jobs after graduation. The company then persuaded the students to take out loans to pay for their tuition, which often totaled more than $100,000. But instead of providing students with the education and training they needed to get good jobs, ITT left them saddled with debt and without any realistic prospects for employment.
ITT Tech also misled investors and government regulators about its finances, in order to keep the money flowing in. When the truth finally came out, the company was unable to survive, and it filed for bankruptcy in 2016.
Thousands of students who were duped by ITT scam are still struggling to repay their loans, while the company’s executives have walked away with millions of dollars in ill-gotten gains.
Updates
In a press release, the government stated that 208,000 debtors would have their student loan obligations canceled. The secretary of education, Miguel Cardona, feels that students who are in debt should not shoulder the burden of ITT’s decades-long deceit. The government has warned DeVry University that it must pay $24 million to settle the borrower’s defense claims.
According to the government, DeVry deceived prospective students about job opportunities after graduation. The institution has denied this statement.
President’s Take
Prior to his election, President Joe Biden favoured debt elimination. He has been contemplating for months whether to cancel up to $10,000 in debt for each person. Although Biden has already said that he would decide by the end of the month, nothing new about his stance was revealed in his comments on Tuesday.
According to the government, $32 billion in student loans were approved for 1.6 million borrowers, including tailored forgiveness programmes for certain debtor categories. As of January 1st, 2005, the federal student loans that were used to investigate ITT Tech were still outstanding.
ITT Tech Scam Conclusion
ITT Tech scam was a massive fraud that bilked thousands of students out of their hard-earned money. The school promised them a quality education and a better future, but delivered neither. Instead, students were left with mountains of debt and no degree to show for it.
The school’s closure has left many students scrambling to find a way to finish their education. While some may be able to transfer their credits to another school, others will not be so lucky. The ITT Tech scam was a heartless scheme that took advantage of vulnerable people and left them with nothing.
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