WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH) today applauded a move by the U.S. Department of Education (ED) to ban ITT Educational Services, Inc. (ITT) from enrolling new students using federal financial aid funds paid for by taxpayers. ED is also increasing oversight of ITT to protect students and taxpayers. ITT is currently facing lawsuits from both the U.S. Securities and Exchange Commission (SEC) and Consumer Financial Protection Bureau (CFPB) regarding its misleading and deceptive practices, and has been informed by its accreditor that it is no longer in compliance with its criteria. The company has also faced numerous questions about its ongoing financial viability.
“Bad actors in the for-profit college industry have mislead students, leaving them without a degree or job and a huge student loan bill,” said Brown. “With ITT’s financial stability and the future of its students especially at risk, this news will not only protect the thousands of students enrolled in ITT, but will ensure ITT can’t continue to waste taxpayer dollars.”
In July 2015, Brown called on ED to take a proactive role in protecting students attending for-profit colleges. In a letter to ED Secretary Arne Duncan, Brown urged the Department to develop a more effective strategy for dealing with the bad actors in the for-profit education industry and minimizing the potential harm to taxpayers. In May 2015, Corinthian Colleges, Inc., a for-profit education company subject to multiple state and federal investigations regarding fraud and misconduct shuttered after declaring bankruptcy. This left Corinthian Colleges, Inc. students with billions of dollars in loans from an institution that granted degrees of questionable value. In his letter, Brown noted that ITT, along with several other for-profit education companies, is also experiencing financial struggles and is subject to state and federal investigations.
Brown continues to work to protect students from predatory practices. Brown joined a letter to the VA in June 2015, asking it to investigate ITT Tech and take action to protect veterans attending the school. ITT Tech was the third largest recipient of Post-9/11 GI Bill benefits in 2012-13 despite scrutiny by various state and federal agencies for misconduct surrounding marketing and recruiting practices, job placement rates, and other misleading and deceptive practices. Brown also called on the U.S. Department of Veterans Affairs (VA) to include a “risk index” in the GI Bill Comparison Tool, an online application that would highlight bad actors in the for-profit industry and give veterans the resources needed to make informed decisions about their education.