For anyone watching, September has been a domino chain of disaster for students at the for-profit educational franchise ITT Tech. In August, the federal Department of Education banned the company from enrolling any new students using federal financial aid, on the grounds that the company had become a financial risk both to those students and to the taxpayers backing those federal loans.
ITT Tech responded by closing its doors. The school made the abrupt announcement of closure on September 6, a week into its fall term, shutting down all 130 of its U.S. campuses. More than 35,000 students were suddenly dis-enrolled, and more than 8,000 jobs were immediately lost.
ITT Tech has been in trouble for some time. In 2014, the school defaulted on a $100 million loan from its main lender, Cerberus Capital Management. Cerberus seized the company’s bank accounts in the wake of its closure.
On the student side, there has been a long history of complaints that ITT misrepresents the statistics of job placement for graduates. Its commercials, which are common nationwide, are well known for stating explicitly that students are certain to be hired before they even graduate.
Community colleges nationwide have been reaching out to help the displaced students, offering to provisionally accept their transfer credits so they don’t have to begin their education again. They are doing so provisionally because ITT’s educational standards are well below par for most schools. State departments of education have reached out to the laid-off work forces. There is a great deal of need, nationwide, for qualified educators.
ITT Tech is the second major for-profit educational company to go under this year. The first was Corinthian, which is still under investigation for predatory recruiting tactics.
ITT students have some resources to help them with their extant student loans, others to help them continue their studies, but the effects of this closure will last for years.