Jan 14, 2017 08:12 AM EST
Former ITT Tech Students Seek Cancellation Of Debt With For-Profit School
Former ITT Tech Institute students have filed a request to establish themselves as creditors in the for-profit school's bankruptcy hearings. They also want their debts to be canceled.
USA Today College reported that last Tuesday, Jan. 3, five former ITT Tech students filed to represent hundreds of thousands of other students who claimed that they were defrauded by the for-profit school. In the 109-page complaint, it was stated that their goal was to have their student debts canceled.
Last year, the school filed for bankruptcy after its access to federal student aid was cut off by the Department of Education. When it declared bankruptcy in September, ITT Tech had already faced lawsuits from the Consumer Financial Protection Bureau, the Securities and Exchange Commission as well as the Massachusetts and New Mexico attorneys general.
The complaint of the former students aims to establish that the for-profit school defrauded its students who were enrolled during the last 10 years. Harvard Law School's Legal Services Center is representing the students. Eileen Connor, the center's director of litigation for its Project on Predatory Student Lending, is the lead attorney.
Speaking to Harvard Law Today, Connor revealed the reason why the center decided to help the former ITT Tech students. This is because "one of the biggest and most predatory for-profit colleges" should give its students debt relief.
She also admitted that they wanted to bring the stories of students as well as the work of student debt resisters such as Debt Collective to the public. Moreover, the lawsuit is significant since it could provide a deeper understanding of student debt and how the government can develop stricter requirements in accessing federal student aid.
According to the New York Times, ITT reported a total of $389 million assets and $1.1 billion liabilities to the bankruptcy court. The company was also able to deposit $94 million with the Education Department before it finally collapsed, which could be used for loan forgiveness.
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