CFPB Sues ITT Tech For Allegedly Exploiting Students, Pushing Predatory Loans

[ProSense]

CFPB Sues ITT Tech For Allegedly Exploiting Students, Pushing Predatory Loans

By Ashlee Kieler

The Consumer Financial Protection Bureau filed a federal lawsuit against a well-known for-profit college chain, alleging the company exploited its students and pushed them into high-cost private student loans that were likely to end in default.

The complaint [PDF] charges that between 2009 and 2011 ITT Educational Services, Inc., pressured students into predatory loans and mislead students on future job prospects and salaries, CFPB director Richard Cordray announced during a news conference Wednesday.

The suit seeks restitution, a civil fine, and an injunction against the for-profit college chain.

“ITT marketed itself as improving consumers’ lives but it was really just improving its bottom line,” CFPB Director Richard Corday said in a news conference Wednesday. “We believe ITT used high-pressure tactics to push many consumers into expensive loans destined to default. Today’s action should serve as a warning to the for-profit college industry that we will be vigilant about protecting students against predatory lending tactics.”

The CFPB’s lawsuit alleges that between July 2009 and December 2011, ITT encouraged students to enroll by providing them with a zero-interest loan called “Temporary Credit.” The credit was used to close the tuition gap between a student’s federal aid and the school’s high tuition rate.

- more -

http://consumerist.com/2014/02/26/cfpb-sues-itt-tech-for-allegedly-exploiting-student-pushing-predatory-loans/

[freshwest]

1. The CFPB is up and running, the crooks better start running now. n/t

[ProSense]

2. Yup, it's doing great work. n/t

[Cali_Democrat]

3. So this is why the Republicans wanted that agency gutted

The Republicans and their enablers don't want an agency that helps consumers who are preyed upon.

[freshwest]

5. Yep, first they denied Warren as chair, then finally broke on Corduray, then tried to defund it. You

know they can see what's on the train coming their way now.

[ProSense]

7. It was all about preventing the bureau from becoming functional.

Idiots.

[rurallib]

4. A huge Yipee!

[ProSense]

6. Kick! n/t

[penultimate]

8. Useless overly expensive scam "school"....

Glad something is finally going after those people. My parents insisted I go there after high school for some reason. They were paying the tuition that my loan didn't cover, but I still had the loan in my name. After they spoke to some of their friends who were positions that hire people in my industry, they realized that ITT Tech grads don't fair too well in the job market because the quality is lacking. They stopped paying my tuition and told me to cut my losses. It sucked at the time, but I'm glad I did. I remember the instructors there giving the questions and answers to the mid-terms and finals the day of the exams. They are only interested in passing as many people as possible, not actually teaching people. Over the years I found out that the exam question/answer thing is pretty common across all the ITT campuses. So if you go there and work your ass off to actually learn, your degree itself puts you very little ahead of others because there are probably more people who just slid through without learning anything.

[ProSense]

9. Kick! n/t

[aikoaiko]

10. Good work, CFPB.