Biden’s Education Department Approves Loan Forgiveness of Students Defrauded by ITT Tech
The Education Dept. under the new Biden administration has approved the loan forgiveness requests of 18,000 students defrauded by the ITT Technical Institute. Through several decades, the for-profit institute founded in 1969 in Carmel, Indiana grew into a chain of colleges across the country. It was shutdown in 2016 while still under the Obama administration due to mounting evidences of misrepresentations.
However, requests for forgiveness of student loans by ITT students filed years ago were not given much attention by the succeeding Education Department of the Trump administration Then Secretary of Education Betsy DeVos seemed oblivious to the claims and that the department has been reported as trying to limit the number of student borrowers qualified to use the ITT fraud as borrower defense.
Biden’s Education Secretary Has Been Addressing the Loan-Forgiveness Applications of Students Defrauded by ITT
Present Education Secretary Miguel Cardona said they understand that they need to act quickly for those whose claims have been pending for years. The announcement last Wednesday included plans to bring loan cancellations through borrower defense for around 90,000 defrauded student-borrowers including war veterans. The total loan forgiveness amount that will be granted is expected to reach a value of $1.5 billion.
The Education Department also announced that the relief will be for two types of requests groups of borrowers:
Request for loan forgiveness after ITT falsely claimed students will be connected to potential employers;
Request for loan forgiveness for loans used to finance education at ITT, which the latter was not able to process as transfer credits due to lack of capability.
How Students Were Duped Into ITT’s Enrollment Scam
According to the documents of the Education Department, the institution repeatedly created significant misrepresentations making students believe that through ITT’s business connection, jobs will be available immediately after graduation. This was how ITT was able to lure students to enroll from 2005 for about 5 years. The school closed in 2016 after complainants started blowing the whistle on ITT’s fraudulent misrepresentations.
Moreover, in 2007 students found out that ITT had not transferred their educational credits to other institutions, which continued up to to October 2014. Since the non-transfer of credits denoted that they did not progress in their educational journey through ITT, they were burdened with student loan debts for naught.
Furthermore, adding their ITT attendance to their resumes only made it much more difficult for them to land a job.
The Department of Education acknowledged the evidence provided by the Iowa Office of the Attorney General, the Consumer Financial Protection, and Veterans Education Success. Without whose assistance would not have made it possible for them to approve the immediate release of the loan-forgiveness relief.
The President of Veterans Education Success Carrie Wofford mentioned that there were a lot of veterans who approached them to complain about ITT Tech’s misrepresentations. Although advocates for student loan borrowers are happy over the approved requests, thousands of other borrowers also deserve to have their loan6s discharged as well.
