ITT Technical Institute

ITT Technical Institute
Motto Education for the Future
Type For-Profit
Established 1969 (1969)
President Eugene W. Feichtner[1][2]
Students 43,293 [3]
Location Carmel, Indiana, United States
Campus Locations Approximately 130 campuses
Affiliations ITT Educational Services, Inc. (1994-2016)
ITT Corporation (1965-1994)
Website itt-tech.edu
ITT Tech Canton, Michigan campus

ITT Technical Institute (often shortened to ITT Tech), is a for-profit technical institute with approximately 130 campuses in 38 states of the United States.[4] ITT Tech is owned and operated by ITT Educational Services, Inc., a publicly traded company headquartered in Carmel, Indiana.[5]

The programs employ traditional, applied and adult-learning pedagogies and are delivered through traditional, accelerated and distance methodologies in a learner-centered environment of mutual respect.[6]

Students and employees have written critically about the school's high tuition and low academic standards.[7] ITT Technical Institute charges among the highest tuition in the industry. It also has the industry's highest rate of loans that go into default within two years of attendance.[8] In 2014, the tuition for attending an ITT Tech campus ranged from $45,000 to $85,000.[9] According to ITT Tech literature, credits earned at ITT Tech are unlikely to transfer to other colleges.[10]

History

ITT Tech was founded in 1946 as Educational Services, Inc. and has been headquartered in Carmel, Indiana, since 1969. From 1965 until its IPO in 1994, ITT Tech was a wholly owned subsidiary of ITT Corporation (as "ITT/ESI"). By 1986, all institutions became known by the common name "ITT Technical Institute". By 1999, ITT Corp. (which had merged with Starwood Hotels & Resorts Worldwide the year before) divested itself completely of ITT Tech's shares but the schools still use the "ITT" name under license. It operates over 130 ITT Technical Institutes across the US, which primarily provide career-focused degree programs to approximately 45,000 students.

On February 26, 2014, the Consumer Financial Protection Bureau sued ITT for its use of loans the college chain knew would default.[11] In August 2014, the US Department of Education placed ESI under "heightened cash monitoring" failing to submit financials and compliance audits tied to its administration of federal financial aid. CEO Kevin Modany also announced his resignation.[12]

The bad student loans negatively affected several credit unions, including the Ely Lily Credit Union. [13]

In the wake of these problems, accounting firm PricewaterhouseCoopers left ESI and [14]Deloitte was named the external auditor for ESI.[15] In November 2014, J.P. Morgan Chase Bank loaned ITT Educational Services $79,000,000 to "satisfy a federal penalty".[14] In December 2014, Cerberus Capital Management issued a $100,000,000 term loan to ESI. The loan will mature in December 2017.[16]

In 2014, the New York Times reported that 57% of ITT Tech schools were in danger of failing proposed gainful employment regulations.[17]

In 2015, a group of students and former students of ITT Tech formed the ITT Tech Warriors to fight for student loan relief. [18]

Academics

ITT Tech offers associate, bachelor's, and master's (business-only, online) degrees. As of December 31, 2015, the ITT Technical Institutes were offering 49 education programs in various fields of study.[19]

At the vast majority of campuses, the academic schedule is organized on the basis of four 12-week academic quarters in a calendar year with new students beginning at the start of each academic quarter. Using that calendar, students taking a full course load can complete associate degree programs in seven or eight academic quarters, bachelor's degree programs in 14 or 15 academic quarters and a master's degree program in seven academic quarters.[19]

Depending on student enrollment, class sessions at the vast majority of ITT Technical Institute campuses are generally available during the day and evening. The courses for education programs that are taught online over the Internet are delivered through an asynchronous learning network and have a prescribed schedule for completion of the coursework. At the vast majority of ITT Technical Institute campuses, the class schedule for education program residence courses and the coursework completion schedule for education program online courses generally provide students with the flexibility to maintain employment concurrently with their studies. Based on student surveys, they believe that a majority of ITT Technical Institute students work at least part-time during their programs of study. A significant portion of classes involve practical study in a lab environment.[19]

Accreditation

ITT Tech is nationally accredited by the Accrediting Council for Independent Colleges and Schools (ACICS). According to ITT Educational Services' last annual report, 31 campuses and more than 400 programs are not meeting ACICS standards for student retention.[20] Per the ITT Tech web site, "it is unlikely that any credits earned at an ITT Technical Institute will be transferable to or accepted by any institution other than an ITT Technical Institute."[6] In April 2016, ACICS issues the company a "show cause" order to request information establishing why the accreditor should continue to accredit the institution.[21]

Campus closings

The following campuses were scheduled to close in 2014 and 2015 [22]

Lawsuits and complaints against ITT

In August 1998, 15 former students alleged misrepresentation, fraud and concealment by ITT arising out of their recruitment and education at ITT campuses. In September 1998, ITT settled all of the claims.[23]

On February 25, 2004, federal agents raided the company's headquarters and ten of its campuses.[24] The investigation negatively affected the company's stock and triggered several class action lawsuits by investors.[25][26] In October 2005, ITT agreed to pay $730,000 to settle a lawsuit with California in which employees alleged that it inflated students' grade point averages so they qualified for more financial aid from the State of California.[27]

An investigation by WGBA-TV (NBC26, Green Bay, Wisconsin) found evidence of widespread grade inflation. In one instance, a student got 100% on a computer forensics assignment by emailing the professor a noodle recipe. The station believes this to be a way to increase federal student aid funding.[28] In early March 2011 WTMJ-TV (NBC4, Milwaukee, Wisconsin) ran an investigation finding teachers lying on attendance records so they could get cash bonuses paid by ITT Tech. ITT Tech formerly used an attendance policy as part of a requirement to get financial aid to show student progress.[29]

In 2013, a complaint was filed against ESI and two ESI executive officers in US District Court for the Southern District of New York regarding securities. The Massachusetts Laborers' Annuity Fund filed a similar complaint and the cases were consolidated. The Plumbers and Pipefitters National Pension Fund and Metropolitan Water Reclamation District Retirement Fund were the lead plaintiffs.[30] Students continue to allege that private loans with JP Morgan Chase and other banks are predatory.[31] In 2013 USA Today listed more than 50 ITT campuses as "red flag" schools because their student loan default rates were higher than their graduation rates.[32]

On February 26, 2014, the Consumer Finance Protection Bureau (CFPB) sued ITT, alleging that they used high-pressure tactics to coerce students into high-interest private loans that were likely to end in default.[31][33] ESI is also being investigated by at least a dozen state attorneys general.[30][34][35] On October 19, 2015, the U.S. Department of Education announced that because of the company's failure "to meet its fiduciary obligations," it was being placed under "heightened cash monitoring".[36]

According to a July 2014 Senate Health, Education, Labor, and Pensions (HELP) committee report, 57% of ITT programs would fail the Department of Education’s proposed Gainful Employment rule.[37]

In a 2015 federal whistleblower lawsuit, a former ITT Tech dean of academic affairs alleged that the company (1) directed recruiters to use coercive tactics to pressure students into enrolling, (2)admitted students who were unable to succeed at the school, (3) unlawfully paid sales commissions to recruiters, and (4) lied to students about their financial obligations and transferability of ITT credits to other schools, and about the jobs students could expect to get after graduating.[38]

In 2015, The California Department of Veterans Affairs (CalVet)temporarily ordered ITT Tech to stop enrolling new or returning students who fund their educations with GI Bill benefits.[39]

In 2015, CEO Kevin Modany and CFO Daniel Fitzpatrick were charged with fraud by the Securities and Exchange Commission [40]

In 2016, Massachusetts Attorney General Maura Healey sued ITT Educational Services for allegedly "misleading and harassing students." [41][42] Breckinridge nurses also sued ITT Education for fraud.[43]

The following states have issued subpoenas or CID's against ITT Tech under the authority of each state’s consumer protection statutes: Arkansas, Arizona, Colorado, Connecticut, District of Columbia, Hawaii, Idaho, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, North Carolina, Oregon, Pennsylvania, Tennessee and Washington.[44]

Defense to repayment

Students who are attending a school that is closing, or claim that they were defrauded may be able to have their federal debt forgiven through defense to repayment.[45][46]

References

  1. ↑ "Corporate Governance - Management & Directors". ITT Education Services. Retrieved 2010-04-16.
  2. ↑ "Eugene Feichtner: Executive Profile & Biography". BusinessWeek. Retrieved 2010-04-16.
  3. ↑ http://finance.yahoo.com/news/itt-educational-services-inc-reports-103000842.html
  4. ↑ ITT Educational Service, Inc. 10-k Annual Report Year-ending December 31, 2015
  5. ↑ "FAQ." ITT Technical Institute. Retrieved on November 23, 2011. "Our principal executive offices are located at: ITT Educational Services, Inc. 13000 North Meridian Street, Carmel, Indiana 46032"
  6. 1 2 http://www.itt-tech.edu
  7. ↑ http://www.nytimes.com/2010/03/14/business/14schools.html?src=me&ref=general&_r=0
  8. ↑ Bill Alpert (14 April 2012). "Clever Is as Clever Does". barrons.com.
  9. ↑ http://programinfo.itt-tech.edu/cost.pdf
  10. ↑ https://www.itt-tech.edu/downloads/credits.pdf
  11. ↑ "U.S. sues college chain ITT over loans". USA Today. February 26, 2014. Retrieved February 27, 2014.
  12. ↑ "ITT Educational CEO signals resignation amid stock freefall, federal scrutiny". ibj.com.
  13. ↑ http://www.cutimes.com/2014/05/07/elfcu-stung-with-itt-student-loan-loss
  14. 1 2 "ITT Auditor Walks Away Amid CEO Search". law360.com.
  15. ↑ "EDGAR Pro". edgar-online.com.
  16. ↑ "ITT Educational Services (ESI) Enters $100M Term Loan Agreement with Cerberus Business". StreetInsider.com.
  17. ↑ http://www.nytimes.com/interactive/2014/07/03/upshot/100000002977650.mobile.html?_r=1
  18. ↑ http://wiki.debtcollective.org/ITT_Tech
  19. 1 2 3 ITT Educational Services, Inc. 10-k Annual Report Year-ending December 31, 2015
  20. ↑ http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=11257777-842-925692&type=sect&TabIndex=2&dcn=0001193125-16-504396&nav=1&src=Yahoo
  21. ↑ https://www.insidehighered.com/quicktakes/2016/04/21/under-scrutiny-itself-profit-accreditor-gets-tough-itt-tech
  22. ↑ http://wiki.debtcollective.org/ITT_Tech
  23. ↑ ITT Educational Services, Inc · 424B4 · On 1/27/99
  24. ↑ Feds serve warrants at ITT Tech campuses, CNN
  25. ↑ "MCPmag.com -- Microsoft Certified Professional Magazine Online". certcities.com.
  26. ↑ ITT's CEO Expects Lengthy Federal Investigation, Stock Slips, Channel Web Network, Feb. 26, 2004, Mark Jewell
  27. ↑ "ITT, Calif. Settle False Claims Lawsuit". insidehighered.com.
  28. ↑ Diamant, Aaron. "I-Team: Easy A's". WGBA-TV. Archived from the original on 2011-02-18. Retrieved 2014-11-02.
  29. ↑ Jim Conigliaro. "TODAY'S TMJ4 - Milwaukee's Source for Local News and Weather". JRN.com.
  30. 1 2 "EDGAR Pro". edgar-online.com.
  31. 1 2 "CFPB Sues For-Profit College Chain ITT For Predatory Lending". Consumer Financial Protection Bureau.
  32. ↑ Mary Beth Marklein, Jodi Upton and Sandhya Kambhampati, USA TODAY (2 July 2013). "College default rates higher than grad rates". USA TODAY.
  33. ↑ Lopez, Ricardo. "Regulator accuses ITT for-profit college chain of predatory lending". latimes.com. Retrieved 2014-02-27.
  34. ↑ "State Attorneys General Open Major Investigations of Big For-Profit Colleges". The Huffington Post.
  35. ↑ Stephanie Armour and Alan Zibel (13 January 2014). "CFPB, State Attorneys General Expand For-Profit College Probe - WSJ". WSJ.
  36. ↑ Nick DeSantis and Goldie Blumenstyk , "U.S. Tightens Restrictions on ITT's Access to Federal Student Aid", Chronicle of Higher Education, Oct. 20, 2015 Accessed 21 Oct , 2015
  37. ↑ http://static1.squarespace.com/static/556718b2e4b02e470eb1b186/t/56007ca2e4b0a6f05d145686/1442872482088/ITT+Profile-TC+Edits.pdf
  38. ↑ http://www.huffingtonpost.com/davidhalperin/blockbuster-lawsuit-claim_b_9040584.html
  39. ↑ http://www.military.com/education/2015/05/18/california-suspends-itt-tech-gi-bill-eligibility.html
  40. ↑ https://www.sec.gov/news/pressrelease/2015-86.html
  41. ↑ http://www.huffingtonpost.com/davidhalperin/massachusetts-sues-itt-te_b_9610440.html
  42. ↑ http://www.csmonitor.com/USA/Education/2016/0405/Massachusetts-sues-ITT-Tech-alleging-predatory-practices
  43. ↑ http://www.courthousenews.com/2016/04/08/students-say-itt-recruiters-misled-them.htm
  44. ↑ https://www.nclc.org/images/pdf/pr-reports/for-profit-gov-investigations.pdf
  45. ↑ http://blog.debtcollective.org/itttechclosures/
  46. ↑ http://www.marketplace.org/2016/01/28/education/thousands-former-students-apply-debt-relief

External links

This article is issued from Wikipedia - version of the Thursday, May 05, 2016. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.