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Today, the college ITT Tech, serving over 60,000 students online and in 39 states, shut its doors. After allegations of fraud, loan laundering, and other deceptive student practices created more questions than answers, the U.S. Department of Education banned the school from enrolling students using federal financial aid. The college’s financial model could not survive the ban.
Christine Lindstrom, higher education advocate for the U.S. Public Interest Research Group, praised the news:
“The rules of the game in higher education have been clear for some time: if for-profit colleges treat students fairly and honestly, then they’re eligible to receive federal financial aid.
In the case of ITT Tech, there’s a long, well-documented history of this company pushing high risk, predatory loan products on their students. In light of these tactics – and a slate of other major issues – the Department of Education was obligated to step in and protect new generations of students from this trap.”
ITT Tech is currently being sued by the New Mexico Attorney General, the Massachusetts Attorney General, the Consumer Financial Protection Bureau, and the Securities and Exchange Commission, and is under investigation in 18 states.
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