ITT Technical closes 130 campuses after DOE cuts off loans for over aggressive recruiting promises– 40,000 students lose

Following the U.S. Department of Education ban on ITT Technical Institute enrolling new students, , the nation’s largest for profit college chain has closed more than 130 campuses ousting more than 40,000 students at campuses in 39 states. The Department of Education’s ban on loans for ITT is part an overall investigation of for profit colleges. It is examining the promises made to prospective students made by ITT and other schools about job placement potentials.ITT is under investigation by the Securities Exchange Commission, Consumer Financial Protection Bureau and several states over its recruiting and job placement claims. Most of the students got federal loans. The company received 80% of its revenue from Title IV federal aid including Pell grants and student loans.

The average annual cost for attending ITT is $23,000, about $7,000 higher than the national average for not-for-profit public colleges. Graduation information was not available for the Madison or Mobile locations but the Bessemer campus has a graduation rate of 31 percent.

According to Department of Education, current ITT students can continue their courses using federal aid. If the school closes, Mitchell said students who owe money for federal loans will likely be eligible to have those debts discharged.