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ITT Tech It closed its doors in 2016 after the state barred new students receiving federal aid from enrolling.
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Rich Pedroncelli/Associated Press
The Department of Education on Tuesday forgave the remaining federal student loans from former ITT Technical Institute students who were defrauded by the now-defunct for-profit college.
The nearly $4 billion group divestiture will wipe out loans to 208,000 borrowers that ITT participated in from 2005 until its closing in September 2016.
Last August, the Department of Education issued $1.1 billion in loans to 115,000 former ITT students.
ITT Tech closed in 2016 after the government barred new students receiving federal aid from enrolling. “The damage to our students and employees, as well as our shareholders and American taxpayers, is irreparable,” ITT said at the time.
So far, according to the Education Department, the Biden administration has paid out $13 billion in loan relief to institutions it says are fraudulent borrowers.
“For years, ITT leaders have deliberately misled students about the quality of their programs in order to profit from federal student loan programs,” U.S. Secretary of Education Miguel Cardona said in a press release.
DeVry is also asking for a university.,
Other for-profit colleges, pay nearly $24 million to cover approved borrower defense applications.
Earlier this year, the department said it approved the claims after discovering DeVry had misled prospective students nationwide by misrepresenting job placement rates. The chain found that 90% of its graduates were employed within six months of graduation, but the actual job placement rate was about 58%, the agency said.
Tuesday’s measures come two weeks before the student loan debt repayment pandemic is supposed to be frozen — though industry experts predict the Biden administration will extend the freeze before the Aug. 31 deadline.
Write Isabelle Sarraf at isabelle.sarraf@wsj.com
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In the August 17, 2022 print edition, ‘Remaining ITT Tech loans forgiven.’
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