For Immediate Release: Contact: Attorney General …
For Immediate Release: April 1, 2021 Contact: Matt Baca -- (505) 270-7148
Attorney General Balderas Calls on U.S. Department of Education to Cancel Loans of ITT Tech Students
Santa Fe, NM--Attorney General Balderas today called on the U.S. Department of Education to cancel federal student loan debt of those who attended ITT Technical Institute. The now defunct for-profit school defrauded thousands of individuals by encouraging them to enroll and borrow loans based on false and misleading information about the value of an ITT degree and empty promises of high-paying jobs after graduation. The borrower defense application that a bipartisan coalition of 24 states and the District of Columbia filed today includes students who attended ITT Tech between at least 2007 and 2011 when these deceptive tactics were used to convince students to attend the school and borrow federal student aid. This widespread and pervasive misrepresentation violated state consumer protection laws. Federal law permits the Department of Education to forgive federal student loans when borrowers were deceived in obtaining loans. The attorneys general are demanding full relief to ITT students, including refunds of the money students already paid on those loans.
"Students who are trying to achieve the American dream and make a better life for their families should not be taken advantage of by for-profit schools and be left with burdensome debt," said Attorney General Balderas. "My office will continue to fight on behalf of students and families to ensure their safety and opportunities for prosperity."
Based on a 2012 congressional report, ITT enrolled roughly 282,000 students across the country between 2007-2010. During this enrollment period, ITT showed a document, "Value Proposition for Employed Graduates," to prospective students to convince them to enroll and, in most cases, borrow thousands of dollars in federal student aid. Analysis of the Value Proposition chart (Figure 1 in the document), revealed that ITT misrepresented the value of its education, claiming it would be substantial, and that students who enrolled would get high-paying jobs upon graduation with a constant rate of earning growth. ITT's Value Proposition chart shows a projected annual salary over an estimated work life, misrepresenting the projected annual earnings for ITT graduates at $100,000 more than the average earnings of workers with the same credentials.
Dr. Jordan Matsudaira, an Associate Professor of Economics and Education Policy at Columbia University, analyzed and evaluated the accuracy of this chart and ITT's claims. Matsudaira found that ITT massively overestimated the financial gains that borrowers could reasonably expect from an ITT program.
Attorney General Balderas joined in the letter with the attorneys general of Colorado, Connecticut, the District of Columbia, Hawaii, Idaho, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, Minnesota, Nebraska, Nevada, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Tennessee, Vermont, Virginia, Washington, and Wisconsin.
A copy of the letter is attached. ###
STATE OF COLORADO DEPARTMENT OF LAW
.
OREGON DEPARTMENT OF JUSTICE OFFICE OF THE ATTORNEY GENERAL
April 1, 2021
The Honorable Miguel A. Cardona Secretary of the U.S. Department of Education 400 Maryland Avenue SW Washington, DC 20202
RE: Application for Borrower Defense on Behalf of ITT Students
Dear Mr. Secretary:
We write to you to request that the U.S. Department of Education (ED) grant borrower defense to repayment loan forgiveness to anyone who borrowed a federal student loan to pay the cost of attendance for any student who enrolled in ITT Technical Institute between at least 2007 and 2010. For at least four years ITT misled students about the value of an ITT degree, inducing students to enroll and borrow student loans that they could not afford. The school's deceptive behavior violated our state consumer protection laws.
We urge ED to consider the evidence we are submitting to the Borrower Defense Unit, in conjunction with this group application, to grant full discharge and refund of moneys paid on federal student loans taken out by the tens of thousands of students who enrolled at ITT in our respective states.
Our group application on behalf of ITT student borrowers is enclosed. We respectfully request a written response to the application with a clear indication of whether ED approves or denies discharge and refunds, and the basis for its decision.
Sincerely,
ATTORNEY GENERAL FOR THE STATE OF COLORADO
ATTORNEY GENERAL FOR THE STATE OF OREGON
PHILLIP J. WEISER
ELLEN F. ROSENBLUM
ATTORNEY GENERAL FOR THE STATE OF MINNESOTA KEITH ELLISON ATTORNEY GENERAL FOR THE DISTRICT OF COLUMBIA
KARL A. RACINE ATTORNEY GENERAL FOR THE STATE OF WASHINGTON BOB FERGUSON ATTORNEY GENERAL OF THE STATE OF NEW JERSEY
GURBIR S. GREWAL ATTORNEY GENERAL FOR THE STATE OF VERMONT
THOMAS J. DONOVAN, JR. EXECUTIVE DIRECTOR, STATE OF HAWAII OFFICE OF CONSUMER PROTECTION STEPHEN H. LEVINS ATTORNEY GENERAL FOR THE STATE OF MARYLAND
BRIAN E. FROSH
ATTORNEY GENERAL FOR THE STATE OF IDAHO __________________________________________ LAWRENCE G. WASDEN ATTORNEY GENERAL FOR THE STATE OF ILLINOIS
KWAME RAOUL ATTORNEY GENERAL FOR THE STATE OF PENNSYLVANIA
JOSH SHAPIRO ATTORNEY GENERAL FOR THE STATE OF IOWA
TOM MILLER ATTORNEY GENERAL FOR THE STATE OF VIRGINIA MARK HERRING ATTORNEY GENERAL FOR THE STATE OF MAINE
AARON M. FREY ATTORNEY GENERAL FOR THE STATE OF KANSAS DEREK SCHMIDT
ATTORNEY GENERAL FOR THE STATE OF NEW MEXICO
HECTOR BALDERAS ATTORNEY GENERAL FOR THE STATE OF NORTH CAROLINA
JOSH STEIN ATTORNEY GENERAL FOR THE STATE OF NEW YORK
LETITIA JAMES ATTORNEY GENERAL FOR THE STATE OF MASSACHUSETTS
MAURA HEALEY ATTORNEY GENERAL FOR THE STATE OF NEBRASKA DOUGLAS J. PETERSON ATTORNEY GENERAL FOR THE STATE OF WISCONSIN ___________________________ JOSHUA L. KAUL ATTORNEY GENERAL FOR THE STATE OF CONNECTICUT
WILLIAM TONG
ATTORNEY GENERAL FOR THE STATE OF NEVADA
AARON D. FORD ATTORNEY GENERAL FOR THE STATE OF TENNESSEE HERBERT SLATERY, III
To: Miguel A. Cardona Secretary of the U.S. Department of Education
Cc: Colleen Nevin Director of the Borrower Defense Unit, U.S. Department of Education
From: The Attorneys General of Colorado, Oregon, Connecticut, District of Columbia, Idaho, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, Minnesota, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, Tennessee, Vermont, Virginia, Washington, and Wisconsin; and the State of Hawaii's Office of Consumer Protection
Date: April 1, 2021
RE: Application for Borrower Defense to Repayment Discharge on behalf of ITT Borrowers
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