ITT Tech schools across the nation closed their doors displacing 8 thousand employees and as many as 40 thousand students on Monday after federal officials banned the school from accepting any students who rely on federal financial aid.
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The ED is still investigating ITT Tech for evidence that it defrauded students in some way.
Students who are eligible include those who were enrolled when the school closed, on an approved leave of absence when the school closed, or those who withdrew from the school 120 days prior to the closure. The law affects employers with more than 100 employees and business sites with more than 50 workers. The school now faces fraud charges from the Securities and Exchange Commission accusing executives of lying to investors about losses from its student loan program. Unfortunately, credits will not be transferred to other colleges.
ITT Tech has been under investigation since 2002.
It was no surprise that the school closed. Last year, the chain generated $850 million in revenue, about $580 million of which came from federal student loans.
“The actions of and sanctions from the U.S. Department of Education have forced us to cease operations of the ITT Technical Institutes, and we will not be offering our September quarter”, said a press release from the school. The school was required to put aside $247.3 million in case the school went out of business, and it has.
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ITT Technical Institute, which has operated throughout the United States for half a century, eliminated the positions of most of the school’s 8,000 employees, with the remaining staff left to help those students with their educational records and any future educational needs. The school now faces fraud charges from the Securities and Exchange Commission and a lawsuit from the Consumer Financial Protection Bureau.
