Predatory Lending/Consumer Protection Clinic

The Department of Education Is Still Trying to Take Students’ Tax Returns

The rights of more than 100,000 borrowers are affected by this court ruling.

Update, March 28, 2019:

Even after a federal judge told it to stop, the Department of Education is still trying to get away with stealing students’ tax refunds.

Five months ago, the court told the Department that it must stop using this aggressive collection method against Everest Massachusetts borrowers. However, the Department stubbornly has only recognized the court’s order as applying to the two named plaintiffs, and continued to seize the tax refunds of other students who are covered by the pending borrower defense claim filed by the Massachusetts Attorney General on behalf of all Everest Massachusetts borrowers.

Because the Department refuses to follow the court’s order in this case, AG Healey recently filed a motion to force the Department to comply with the court order and stop using tax refund offset to collect on any Everest students in Massachusetts. Yesterday, we submitted our own filing in support of that motion. The government opposed.

My Student Loan Truth: Kristina’s Virginia College Story

In our Student Loan Truth blog series, our clients share what they really got from their for-profit college and how the debt affected them. Their experiences demand a public reckoning on student debt and an end to the predatory practices of for-profit colleges.

This is Kristina’s student loan truth.Virginia College Student

“I was focused. I had goals.”

When Kristina Jefferson enrolled in the cosmetology program at Virginia College last year, she thought she would have been proudly walking across the stage at her graduation with her cosmetology certificate this month, and prepared to take her cosmetology licensure examination, but the school failed her. Virginia College’s abrupt shutdown last year was just one of many instances where the school failed her and the rest of its students.

Thousands of students like Kristina have been left with no school, no education, and tens of thousands of dollars in debt by Virginia College and other schools owned by its parent company, Education Corporation of America.

If you were a student at Virginia College, Brightwood College, Brightwood Career Institute, Ecotech Institute, Golf Academy of America, or New England College of Business, click on this link to find out more information about the status of the schools and how you may be able to file a claim for a refund if the school has any assets left.

 

How did you hear about Virginia College?

Virginia College had a lot of commercials with people explaining their life struggles and how the school helped them. There was one commercial with a Black woman riding the bus that stuck out to me. She was homeless, and she had two children. She decided to go to school for Medical Assisting, and it bettered her life. After attending Virginia College, she got a job, her life improved, and she had more stability. She didn’t have to ride the bus anymore. I understood her struggle because I relied heavily on the bus for transportation, and I, too, wanted to better my life.

That was in 2014; I decided to go to Virginia College for Medical Assisting because I wanted to care for people. I know how it feels to be sick. I am a good listener. I wanted to help lift people’s spirits.

They never helped me get a job in the medical field. But I had taught myself how to do hair and had been doing it for years, so in 2018 I decided I wanted to hone my skills and get licensed. I had seen a lot of online advertisements on Facebook and I took it as a sign that I should do the cosmetology program, so I enrolled last year.

 

What did they tell you about the programs and getting a job when you started?

Both times they said we were guaranteed to get a job after we finished the program. It was not true, and all they did was send links of jobs from Indeed. I was living with my mother and was not financially independent. I had to take the bus which required me to wake up at 4am to get to school on time; I even had to walk on the highway. The school promised me that they would help me get a job and help me get an easier commute, but they did nothing.

 

Describe the educational experience at Virginia College.

We had to teach ourselves. The instructors didn’t want to help us understand or answer questions. For the cosmetology program, they only taught by showing us videos. The instructors also didn’t teach us certain skills they said they would. We were supposed to learn how to do makeup, but instead, the instructor gave us a paper printout with a face and we used colored pencils, our own makeup, or the school’s outdated makeup to color in the face.

They promised we would get jobs, help with our resumes, they would teach us, and that our credits were transferable. They didn’t keep any of those promises. They didn’t even keep the school open!

 

How did you get your student loans?

When enrolling I met with the financial aid people, but they didn’t explain anything to me. I didn’t know the amount of loans the school was borrowing on my account. They told me everything would be covered by student loans, but toward the end of my time at Virginia College, I was told I had a balance and wouldn’t be able to receive my certificate if I didn’t pay the balance. That’s on top of the more than $30,000 in federal loans I have because of them.

 

What impact has Virginia College and this debt had on your life?

They really ruined my life, and it’s not right. I had goals. The school closing just made it harder for me. I have to start all over now. I was told that my credits were transferable, but it’s not true. Basically, my transcript is worthless. It’s just a bunch of words. It’s not right.

 

Some policy-makers doubt that for-profit colleges are a problem – what would you say to them?

It is a problem when they are just trying to make money and don’t care about the students. Virginia College closed down and people are suffering. It is not right. They took our money and then closed and left the students to try to fix what they caused.

 

The Department of Education has refused to cancel the loans of thousands of former students of for-profit colleges. What would you say to the Department about the need to cancel these loans?

They need to be more understanding of situations like this and protect the students. It’s not right.

 

Sound familiar? Do you have a similar story to Kristina’s at Virginia College, Brightwood College, Brightwood Career Institute, Ecotech Institute, Golf Academy of America, or New England College of Business? Click on this link to find out more information about the status of the schools and how you may be able to file a claim for a refund if the school has any assets left.

Despite Court Order in it’s Favor, the Project on Predatory Student Lending Continues to Wait for DOJ to Produce Documents

Nearly three years after submitting its original Freedom of Information Act (“FOIA”) request, the Project on Predatory Student Lending is still waiting for the Department of Justice (“DOJ”) to fulfill its legal obligations to produce documents that Education Management Corporation produced to it in a federal whistleblower lawsuit.

On July 9, 2018, the Court ordered DOJ to produce approximately 3,600 pages of documents to the Project—documents that the government had asserted that the public had no right to. Over seven months later, DOJ still has not fully complied with the Court’s order. DOJ initially produced approximately 1,800 pages to our office, refusing to produce the remaining pages. As requested by the Project, the Court again instructed DOJ to produce the remaining 1,800 pages. DOJ then produced the outstanding pages, but many of them were either heavily or completely redacted. After the Project questioned the appropriateness of the redactions, the government determined that it would remove some of the redactions and would reproduce the documents to the Project. Though DOJ has reproduced some of the documents in question, the Project is still waiting for all documents that it is lawfully entitled to.

Related Litigation
DOJ provided conflicting reasons for why it originally withheld documents from the Project. Initially, it cited four FOIA exemptions and protective orders in the whistleblower litigation as the basis for denying the Project’s FOIA request. Later, the government asserted that the requested documents were not agency records and indicated that it had not even searched for or reviewed potentially responsive documents. Consequently, in March 2018, the Project filed a separate FOIA request to DOJ for all records related to its original FOIA request and the administrative appeal of that original request. On December 7, 2018, the Project filed a second FOIA lawsuit against DOJ challenging its failure to respond to this second FOIA request. Despite its complete failure to respond to the Project’s second FOIA request and consistent with its previous recalcitrance to comply with legitimate FOIA requests, DOJ filed its answer in which it denies that the Project is entitled to any documents.

Related Documents
The Court’s Order of July 9, 2018
The Project’s Second FOIA Complaint

Higher Education is Failing Students of Color, but Congress Can Help

The harsh reality is that the burdens of student debt are not shared equally. Students of color borrow more on average than other students seeking the same degree, and are two to three times more likely to default than their white counterparts. Furthermore, because they borrow more, students of color are disproportionately impacted by the negative effects of poor student loan servicing, which contribute to the racial wealth gap.

Beyond the financial barriers to equity in higher education, more generally, students of color are less likely to graduate with degrees than their white peers and are more likely to be pushed out of their schools due to safety concerns. These systemic problems require policymakers to come to the table to drive real change.

Fortunately, select leaders in Congress are acknowledging the issue and are researching ways to address it. Earlier this year, Senators Doug Jones, Elizabeth Warren, Kamala Harris, and Catherine Cortez Masto asked the Project on Predatory Student Lending and other experts to recommend legislative changes to address racial disparities in student debt, as well as the various challenges students of color face in college and career training programs. In partnership with the Lawyers’ Committee for Civil Rights Under Law, Mississippi Center for Justice, North Carolina Justice Center, and Southern Poverty Law Center, we recommended five areas where focused reforms could decrease racial inequality in higher education: (1) more oversight and accountability of for-profit colleges; (2) more data collection and transparency; (3) better oversight and management of loan servicers; (4) eliminate several specific barriers to student access and success; and (5) better protect student safety. Here is a brief summary of our recommendations.

 

1. Oversight and Accountability of For-Profit Colleges

For-profit colleges play an outsized role in generating and perpetuating disparate outcomes for students of color. People of color are significantly overrepresented in the for-profit college student population: although they account for less than one third of all college students, Black and Latino students represent nearly half of the students enrolled in proprietary colleges. In order to attract and enroll these students many for-profit colleges engage in unfair and deceptive practices, including deceptive advertisements and unrelenting recruiting, and leave students without the education and career development support they were promised. In order to combat these predatory for-profit colleges and protect students of color, we proposed:

  • Codification of robust borrower defense protections
  • Regulating spending on marketing and recruiting
  • Strengthen the 90/10 rule
  • Bolster the federal role in the regulatory triad

 

2. Data Collection and Transparency

The Department of Education’s current data on federal financial aid is limited. In order to make fully informed legislative decisions, more comprehensive data collection and rigorous analysis are necessary. We proposed:

  • Codification of a gainful employment standard
  • Study the student unit record ban to determine whether the department should track student loan defaults by race

 

3. Loan Servicing

Loan servicer misconduct comes in many forms, all of which harm borrowers. Student loan servicers commonly steer borrowers into payment plans that are cheaper for the servicer, and costly for the borrower. Additionally, vague communication, misapplied borrower payments, and other customer service misconduct cost borrowers dearly. Because Black students are more likely than other racial groups to borrow, and borrow more, for their education, the negative effects of poor student loan servicing are disproportionately damaging to student borrowers of color. To combat the harmful practices of loan servicers, we proposed:

  • Simplification of federal student loan repayment and increased access to repayment information
  • Statutory support for a Student Loan Borrowers’ Bill of Rights
  • More specific requirements for communications and customer service

 

4. Student Access and Success

Students of color face many barriers in accessing and succeeding in higher education. College degrees have become even more necessary over time to achieve upward mobility and live a healthy economic life in the United States, but students of color lag behind their white counterparts in achieving associate degrees or higher. To increase access for students of color, we proposed:

  • Removing the consideration of criminal background in the determination of eligibility for federal student aid
  • Expanding opportunities for DREAMers to pursue higher education, and allow undocumented students to access federal student aid
  • Increase resources and support to HBCUs, Tribal colleges and universities, Hispanic serving institutions, and Asian American and Native American Pacific Islander serving institutions

 

5. Student Safety and Rights

U.S. Department of Education data show that incidents of hate crimes on college campuses have been increasing over the years and target students of color. This type of crime pushes students of color out of school. To combat this problem, schools must proactively create safe spaces for students of color. To promote student safety, we proposed:

  • Require schools to prevent campus sexual violence, appropriately investigate and respond to instances of sexual violence, and support survivors
  • Require schools to protect students from hate crimes while ensuring First Amendment protections

 

To learn more about the Project on Predatory Student Lending’s work on racial justice, click here.

Argosy University Stipends

In January of this year, Dream Center Education Holdings—the parent company of Argosy and several other schools—entered into a federal receivership. A receivership occurs when a court appoints someone outside a company to control the company, because the company is in serious financial trouble.

When Dream Center Education Holdings entered receivership, it had not distributed the federal student aid stipends to students. It is not clear who has this money and why it has not been distributed to students. Yesterday, the Department notified Argosy University that it lost eligibility for federal student aid. That letter is here.

The Department of Education recently posted information related to its handling of the missing stipends here. The Department is asking students who have not received their stipend to contact Federal Student Aid.

If you have not received your federal student aid stipend, contact Federal Student Aid to explain that you have not received your stipend. Call 1-844-651-0077 between Monday and Friday, 8 a.m.–8 p.m. Eastern, or go online (StudentAid.gov/feedback).

What happens next? It’s not clear: different people are saying different things about how and when Argosy University will close, and what teach-out options will exist when the school closes. Students who are attending Argosy University when it closes or who withdraw shortly before it closes and who do not participate in a teach-out and do not transfer credits to a comparable program at another school can apply to have their federal student loans discharged. For more information about closed-school discharge and how to apply, see https://www.studentloanborrowerassistance.org/loan-cancellation/federal-cancellation/school-related/closed-school/.

Unfortunately, we don’t have any more information right now.

My Student Loan Truth: Rick’s WyoTech Story

In our Student Loan Truth blog series, our clients share what they really got from their for-profit college and how the debt affected them. Their experiences demand a public reckoning on student debt and an end to the predatory practices of for-profit colleges.

 

This month we interviewed Rick Dobashi, who attended Corinthian-owned WyoTech in San Jose, California from 2011-2013. Rick is part of our class action case Calvillo Manriquez v. DeVos, which represents students who were cheated by Corinthian Colleges (WyoTech, Heald, and Everest).  Even though a judge ordered the Department of Education to stop collecting on the fraudulent loans of certain Corinthian students in May, the Department continues to fight back with its latest appeal this month.

This is Rick’s #StudentLoanTruth

 

What made you decide to attend WyoTech?

I went to WyoTech because I saw all these great opportunities advertised – high pay, advanced training, how many jobs are out there, things like that. I wanted to work on something I’m passionate about, so I enrolled in a program for working on high performance cars.

What was the education like at WyoTech?

Once I really got into the program, I started to realize that they weren’t telling us the truth. The few times we actually got to work on cars, they weren’t even up to date, never mind high performance – all built in the 70s and 80s. They also cancelled a lot of the car classes and basically forced us into other, unrelated programs.

It was pretty clear WyoTech just wanted to just us in the door and get our money. They didn’t care about the students or our education.

How did WyoTech affect your employment prospects?

After I finished the program, I went to start looking for jobs and found that those high paying jobs they promised us didn’t exist. They sent us job listings for washing cars – that is if they even had anything to with cars at all.

What I’m doing right now has nothing to do with WyoTech or cars. I’m self-employed and own my own retail tobacco business. I managed to do that despite WyoTech, not because of them.

How has this experience affected your life?

I walked out of there with a $20,000 bill and nothing to show for it. It caused a lot of credit problems for me. Even back when the housing market was somewhat affordable, I couldn’t buy anything because my debt to income ratio was too high. It’s been a difficult rebuilding process for a long time, trying to make ends meet.

You had friends who went to WyoTech at the same time as you, yet they had their loans cancelled and you haven’t received anything. How does that feel?

I feel robbed. If you buy something and it’s defective, you’re supposed to be able to return it. Instead, I’m being punished for trying to get an education and expected to pay over $20,000 for something I never received. We all went to the same school, had the same experience of being lied to. I don’t understand how the government can cancel these loans for some people, but not for others who were in the exact same situation. They should be cancelling all of the loans for these schools.

Some policy-makers doubt that for-profit colleges are a problem – what would you say to them?

This isn’t what education is supposed to be about. If you go to a school and are lied to and don’t get what you’re promised, you shouldn’t have to pay for it. Why should we be punished for trying to get an education, while these schools can just get away with lying and cheating?

 

Rick is one of many thousands of former Corinthian students who are still waiting for the debt cancellation they are owed, as the Department of Education continues to delay doing the right thing. The Project on Predatory Student Lending, along with advocates and elected officials across the country are urging the Department to Cancel Corinthian debts immediately.

What Really Happened at ITT: Jorge Villalba in His Own Words

In our new blog series, our clients share what they really got from their for-profit college and how the debt affected them. Their experiences demand a public reckoning on student debt and an end to the predatory practices of for-profit colleges.

 

This month we interviewed Jorge Villalba, a former ITT Tech student and named plaintiff in the Project’s ITT case.  After being cheated by ITT and struggling with massive debt from the school for years, Jorge finally had his loans discharged – a year and a half after filing a borrower defense application. Below, Jorge shares his story and what this debt, and its cancellation, has meant for him and his family.

 

How did you decide to attend ITT?

I found out about ITT from one of the many commercials they were running on radio and TV. After calling them to find out more information about their programs, I decided to pay them a visit and check out the campus and the equipment they were using. I was told many great things about the programs they offered, how ITT was very reputable, and that big companies were in constant contact with the school looking for students from the programs I was looking into. Because of the statistics they showed me, I was convinced ITT was the school that could help me get my dream job.

 

How did ITT affect your employment prospects?

I was once told, in an interview after graduating with a degree from ITT, that the company would not hire anyone from ITT because the students they got from that school were not capable of doing the minimum job requirements. For an almost six month period I would apply to about 15 jobs a day and I got zero responses. The school was just not respected, and I believe that is why I never got any responses.

 

How did ITT affect your life?

I was in school when the country went into the recession of 2007. I lost my job and I was only surviving because at the time, my wife was working full time and I was getting a paycheck from the unemployment office. When I graduated in 2010 I was working in my field, but was only making $8 an hour. My student loans were due and my wife had just given birth. The financial stress this put on my marriage was too much. The school never came through with any job offers. I was left alone to struggle and survive and in the meantime, I had to decide to buy food for my baby or pay the student loans. Going to ITT made my life a nightmare. All the promises and all the prospects I was offered before I joined the school were a lie.

 

What was it like to borrow student loans at ITT?

It felt like they were trying to get me in no matter what. If I didn’t qualify for loans, they told me not to worry, to ask friends, family, co-workers, or anyone I knew with good credit to be a cosigner. Once I got approved, the process would repeat every so often. Every time I had to sign contracts it was during school hours and while I was attending a class. So in order not to miss anything from that class, I would just go and sign things really quick so I could get back to my class. My mom and my wife co-signed my loans many times because my credit was not enough. My mom did not have a job and she still got approved. At one point, after I graduated, one of my loan service providers told me I put down that I was living on campus when the school had no dorms. They did this to get more money out of my loans.

 

Your federal student loan debt was recently canceled. How did you find out?

I had submitted a borrower defense claim explaining ITTs fraud. While I was waiting to hear back, I was contacted by Victoria at the Project on Predatory Student Lending, who helped me by providing all the information I needed to be able to get these loans discharged. I got an email about a year and a half after I applied, stating that my loans would be discharged. It was because of the Project that this actually happened.

 

How has having this debt canceled improved your life, and the lives of your family?

Having this debt canceled has improved my life greatly. My credit score has improved tremendously and I can finally apply to get other types of credit and better rates on my current debt. I feel like a huge weight has been lifted in my life, my mood is better, and I’m not so stressed out like I was before. I no longer have to live with the worry that I will never be able to pay this debt. I can move on with my life and plan my future.

 

Some policy-makers doubt that for-profit colleges are a problem – what would you say to them?

Policy makers will never understand what the borrower goes through. These schools do not care about the students attending their schools and that will never change. They only care about making money. It is in their name – these schools are “for profit” and that is all they care about.

 

The Department of Education has refused to fully cancel the loans of thousands of for-profit students. What would you say to the Department about this?

These schools should be held to the highest standards of the law. It’s not fair that they are allowed to file for bankruptcy and close without warning and leave thousands of employees and students stranded without any type of repercussion. I went to school to learn, better my life, get a better job, and achieve what they call the America dream. Instead, what I got was less than half an education and debt that could have lasted me a lifetime to pay. While at the same time, the top of the ITT board was lining their pockets with six and seven figure yearly bonuses. I understand the Department of Education does not want to cancel the loans of thousands of struggling students, but the Department of Education should have done a better job at controlling these schools, and they should do a better job of protecting students.

 

Click here to learn more about the Project’s ITT case, in which Jorge is a named plaintiff.

2018: The Year For-Profit College Students Fought Back – And Won

In case after case this year, students represented by the Project on Predatory Student Lending have won hard-fought victories against for-profit colleges and the Department of Education.

for-profit college students

 

2018 marked an important turning point in our legal battles against predatory for-profit colleges and the government policies that fund and enable them. Several times this year, judges struck down illegal policies and ruled in favor of students – affecting hundreds of thousands of former for-profit college students and borrowers and cancelling millions of dollars in fraudulent student loan debt.

These victories demonstrate the power that student borrowers have, and are a testament to their perseverance and willingness to stand up for themselves and others across the nation. It is also a credit to the many dedicated advocates who have worked together for years to challenge illegal policies, support and organize students, and demand meaningful change.

These wins would not have been possible without our dedicated partners and clients, and we look forward to even more in 2019.

 

WIN: ITT Students Secure $1.5 Billion Settlement and $500 Million Loan Cancellation in ITT Bankruptcy.

The year started in with ITT students securing a $1.5 billion claim in the school’s bankruptcy, announced in January. This November, the landmark settlement was approved by the judge, recognizing a $1.5 billion claim for ITT students, cancelling more than $500 million in student debts that were held by the school, and returning $3 million that was paid by students since the company filed for bankruptcy in 2016.

The students are represented by the Project on Predatory Student Lending and our partners at Jenner & Block LLP, who received the 2018 Pro Bono Project of the Year Award from the Turnaround Management Association Chicago/Midwest Chapter for their work on this case.

 

WIN: The 2016 Borrower Defense Rule is Now in Effect.

Students thwarted the Department of Education and the for-profit college industry’s attempts to prevent the implementation of the 2016 borrower defense rule, which includes important protections for student loan borrowers from predatory schools. The Department finally backed down from its stubborn delays after all of its arguments were rejected by the court. As a result, the Borrower Defense rule took effect on October 16, 2018, after more than a year of illegal delays – and directly resulted in the Department’s recent cancellation of $150 million in debt for 15,000 students whose for-profit schools had closed while they attended.

This victory was a rebuke to both the Department of Education and the for-profit college industry. Students did not stop fighting to get this rule implemented, and because of their willingness to fight, these important and long-delayed rules are in effect. Credit is also due to our partners at the Debt Collective, who began mobilizing students around this issue in 2016.

The students in this case were represented by the Project on Predatory Student Lending and our partners at Public Citizen. Read more about the borrower defense rulings and the cases Bauer v. DeVos and CAPPS v. DeVos.

 

WIN: The Department Cannot Seize Tax Refunds from Borrower Defense Applicants.

On October 25, 2018, a federal judge ruled that the Department of Education had illegally taken the tax refunds of two former Corinthian College students to pay their student loans. As a result of this ruling, all student loan borrowers are protected from having their income tax credit seized to pay their federal student loans while their borrower defense applications are pending.

This ruling is one step toward stopping the Department’s long-standing and utter disregard for the rights of students who have been subjected to the harmful practices of the predatory for-profit college industry.

This win is also a credit to Massachusetts Attorney General Maura Healey, as the ruling confirms that the Department has an obligation to consider borrower defense applications submitted by States on behalf of borrowers. Read more about the victory in Williams v. DeVos.

 

WIN: Corinthian Colleges Students Win Injunction and Class Certification; Elected Officials Call on the Department to Cancel All Corinthian Debt.

In a groundbreaking decision in May, a judged granted our injunction to stop the Department of Education’s illegal partial denial rule, stopping the collection of these fraudulent Corinthian debts. Then, in October, a judge certified a class of Corinthian Colleges borrowers, allowing the students to team up to fight for the full loan cancellation they legally are owed. That same day, a group of elected officials and organizations from across the country called on the Department of Education to cancel the debts of all Corinthian College students once and for all. These partners didn’t just advocate on behalf of students on one day – they do it all year long.

The students in this class action lawsuit, Calvillo Manriquez v. DeVos, were represented by the Project on Predatory Student Lending and our partners at Housing and Economic Rights Advocates (HERA).

 

Looking ahead to 2019, this momentum will only continue, as we fight to put a permanent end to these predatory practices and to cancel every dollar of fraudulent for-profit college debt.

ITT Students’ $1.5 Billion Bankruptcy Settlement Approved by Judge

On Wednesday, November 28, the judge in the ITT bankruptcy case gave final approval to the settlement between the student class and the estate of ITT. The settlement is a big victory for former ITT students who were defrauded by the school and provides important relief. The court’s final order approving the settlement will become effective in approximately ninety days, during which time state Attorneys General and the U.S. Attorney General may file objections.

Key Components of the Settlement:

– The student class gets an approved $1.5 billion claim in the bankruptcy. In exchange, former ITT students give up their claims against the estate of ITT, and keep their rights to seek further relief from the Department of Education and private lenders;
– Over $500 million in student debt held by ITT is canceled; and
– ITT’s estate has returned the $3 million that students paid directly to ITT after it declared bankruptcy.

As part of the settlement, the parties got an official ruling from the IRS, saying that the estate is not required to treat the more than $500 million of cancelled debt as taxable.

This landmark settlement has provided more relief to defrauded student borrowers than the Department of Education has in the last two administrations combined.

In fact, the Department of Education has taken every possible to step to thwart relief for students. The Department has only approved 33 borrower defense applications for ITT students, while approximately 14,000 outstanding borrower defense applications sit unadjudicated.

To make matters worse, late last month, Betsy DeVos, Secretary of Education, reinstated the Accrediting Council for Independent Colleges and Schools (ACICS), ITT’s long-time accreditor. In 2016, the Department of Education had cut off ACICS’s ability to accredit schools because it failed to comply with federal criteria designed to make sure that schools like ITT followed federal and state laws and provided an education to students that was worthy of federal student loans. Year after year, ACICS enabled ITT to perpetrate its fraud on students, giving the company access to billions of dollars in federal student loan revenue. Now, ACICS has been given the green light from the Department to continue accrediting schools despite its role in defrauding hundreds of thousands of ITT students.

Meanwhile, this past June, the Securities and Exchange Commission gave former ITT executives Kevin Modany and Daniel Fitzpatrick a sweetheart deal on its charges that Modany and Fitzpatrick cheated the company’s shareholders and operating the company for their own personal financial benefit. On the eve of trial, Modany and Fitzpatrick walked away with a slap on the wrist.

Multiple agencies of the federal government have been loud and clear about where defrauded ITT students stand. But students will be louder. This settlement is an important step in acknowledging students’ experiences and the harms they have suffered at the hands of ITT and ACICS. All ITT-related fraudulent debts, including the federal and private loans that are not covered by this settlement, must be canceled, and we will continue to fight on behalf of students until that happens.

Click here to see the Washington Post’s recent story about the settlement.

Visit our website for additional information for former ITT students and to sign up for email updates about the student class claim in the bankruptcy case.

My Future Was Stolen By A Corporation: An ITT Student Story

The author, Lorenzo Boyland, is a former student of the for-profit ITT Technical Institute campus in Cordova, TN and resides in Mississippi.

My future was stolen by a corporation. Now, I’m left waiting for justice.

There are thousands who could tell a similar story. This is mine.

When I graduated high school, I joined the military and served my country. I served a four-year tour, and then re-upped for four more years, finishing in Iraq.

When I returned home, it was time to find a job. I graduated from  high school near the top of my class. I was an honorably discharged veteran. But I knew I needed a college degree.

One of my best friends told me about ITT’s campus in Cordova, Tennessee, which was conveniently located close to my home. When I sat down with ITT’s recruitment person, it seemed like a perfect fit.

I wanted to pursue a career in computer science. The recruiter promised that if I graduated from ITT, I was guaranteed a job. They promised that if I maintained a 3.4 grade point average, I would receive a discount on my tuition. I made the school aware that I was a military veteran and that my G.I. Bill would help to cover the cost of tuition. They told me not to worry about taking out additional loans, because ITT would put me on track for a well-paying career.

I was excited about beginning my higher education, which ITT sold me as the beginning of the next stage of my life. Then I learned that ITT was all a fraud.

I cared about my education, and I worked hard for my degree. I graduated with that 3.4 and honors. ITT never delivered the promised tuition discount.

I went to the career placement office for help finding a job. They pointed me to the job board at the front of the room.  And they referred me to a retail job at Best Buy.

I thought – that’s what you’re recommending to me? I paid thousands of dollars to you and all you can recommend is Best Buy? I could have done that out of high school.

I went out to find a job on my own, but I did not have many connections. I was directly out of the military and had been away for eight years.  I learned very quickly that the ITT diploma was not worth anything to companies looking to hire, and employers frequently laughed at me when they learned I attended ITT. I studied and succeeded, but the computer science job I worked so hard for never materialized.

When I told ITT that I could not get a job in computer networking, they told me that it was because I only had an associate degree, and that I should enroll for a bachelor’s. ITT tried to prey on my inability to get a job due to their broken promises to convince me to further fund their scam. At that point I realized that I, like so many others, had been completely ripped off.

Since I could not get a job in computer networking, I began working as an overnight baker at Panera. That job allowed me to start making payments toward my $34,000 in federal loans from ITT.

Then I got a call that felt like a punch in the gut. It was Chase Bank asking about another $18,000 loan in my name. I had no earthly idea what they were talking about.

Turns out, ITT had signed me up for an additional private loan without my knowledge. And it was 1000 days past due! I was completely blindsided.

I am continuing to pay down my federal loan. But that private loan? I’ll probably get another call today asking me to pay. I don’t blame the people on the phone – they are just doing their job. But that loan is impossible to get caught up on.

My financial situation wears on me every day. I work hard to try to earn enough to live while paying off my loans. I should not have to pay a dime given the egregious lies ITT sold me.

I am not alone. ITT routinely lied to hundreds of thousands of other students. They targeted people who were eligible for federal loans and grants –including low-income people and veterans like me – and took advantage of our dreams and ambitions.

I work hard. I served my country. I went to college to build a better life. ITT profited off of my aspirations and left me nothing.  ITT’s actions were wrong and illegal. It perpetrated a fraud on hundreds of thousands of students. ITT put us all in a hole without a shovel to dig ourselves out.

ITT declared bankruptcy in September 2016, and even then, only stopped collecting money from students after students sued in the bankruptcy. This week, a judge has finally canceled some ITT debts based on that case.

However, like thousands of other former students, I am still paying federal student loans that funded a school that no longer exists.

We are still waiting for justice.

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