By Alice Seeley
On Aug. 16, the U.S. Department of Education announced it would cancel $3.9 billion in student loan debt for 208,000 students who attended ITT Technical Institute (ITT) from January 2005 through September 2016.
The decision came after an extensive investigation launched by the Department through ITT records and testimonies from ITT staff and students.
“It is time for student borrowers to stop shouldering the burden from ITT’s years of lies and false promises,” U.S. Secretary of Education Miguel Cardona stated in a press release. “The evidence shows that for years, ITT’s leaders intentionally misled students about the quality of their programs in order to profit off federal student loan programs, with no regard for the hardship this would cause. The Biden-Harris Administration will continue to stand up for borrowers who’ve been cheated by their colleges while working to strengthen oversight and enforcement to protect today’s students from similar deception and abuse.”
ITT closed in September 2016 after the government withdrew its federal funding because it had failed to show that it met certain accreditation standards. At the time of its closure, the institute was the subject of several state and federal investigations. ITT was found guilty of misrepresenting its students’ ability to get a job or transfer credits and lying about the accreditation of its associate degree in nursing.
“ITT defrauded hundreds of thousands of students, as we identified when I was the director of the Consumer Financial Protection Bureau,” said Federal Student Aid Chief Richard Cordray. “By delivering the loan relief students deserve, we are giving them the opportunity to resume their educational journey without the unfair burden of student debt they are carrying from a dishonest institution.”
Rohit Chopra, Director of the Consumer Financial Protection Bureau, agreed with Cordray, remarking, “The automatic loan cancellation announced today will provide life-changing relief that has long been owed to former ITT students. Far too many Americans are still on the hook for loans they acquired at colleges that profited from deceiving students, and the CFPB will continue to work with the Department of Education to address predatory student loan debt, to protect students, and to hold wrongdoers accountable.”
This decision brought the total amount of student loans forgiven under President Joe Biden to nearly $32 billion for 1.6 million borrowers.
