The Chantilly Campus of ITT Technical Institute sits closed and empty on Sept. 6, 2016, in Chantilly, Virginia.
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The U.S. Department of Education announced on Tuesday that it will cancel all remaining federal student debt taken on by borrowers who were defrauded by ITT Technical Institute since 2005, delivering $3.9 billion in relief to some 208,000 people.
ITT Educational Services was at one point one of the largest operators of for-profit technical schools in the U.S., and shut down in 2016. Borrowers shouldn’t have to apply for the relief, the Education Department said.
The Education Department found that ITT Tech engaged in widespread and pervasive misrepresentations, including lying about students ability to get a job or transfer credits.
“The evidence shows that for years, ITT’s leaders intentionally misled students about the quality of their programs in order to profit off federal student loan programs, with no regard for the hardship this would cause,” said U.S. Secretary of Education Miguel Cardona, in a statement.
“The Biden-Harris Administration will continue to stand up for borrowers who’ve been cheated by their colleges, while working to strengthen oversight and enforcement to protect today’s students from similar deception and abuse,” Cardona added.
To date, the Biden-Harris Administration has approved the cancellation of nearly $32 billion in student loans for 1.6 million borrowers.
“President Biden continues to use existing statutory authority to forgive more student loan debt than any previous president,” said higher education expert Mark Kantrowitz.
Still, The White House is currently under intense pressure to cancel student debt for all borrowers, and President Joe Biden has promised to make a decision on how to act, if at all, by the end of the month.
This is a developing story. Please check back for updates.
Source : CNBC