EDUCATION: For-profit colleges accused of coercing students into costly loans

By Melody Petersen ITT Technical Institute, the for-profit college chain, has long promoted its pricey courses as a path to a higher-paying job and a better life. But for many of its students in Orange County and across the country, that dream became a financial trap, according to a lawsuit brought by federal regulators. The civil complaint by the Consumer Financial Protection Bureau alleges that ITT employees illegally coerced some of its most vulnerable students into taking out high-interest private loans when their federal aid was not enough to pay its tuition. Those employees, who were paid based in part on how many students took out the loans, threatened to withhold some students’ transcripts or expel them from classes if they didn’t sign papers authorizing the debt, according to the complaint. The government also claims that the company’s recruiters used “aggressive and controlling” sales tactics to fill its classrooms with students, who were charged $44,000 for a two-year degree, one of the nation’s most costly career programs. “ITT sacrificed its students’ futures by saddling them with debt on which it knew they would likely default,” said the complaint, which was filed in U.S. District Court in Indianapolis Feb. 26. Read the entire article here:

Tags: , , ,

Trackback from your site.