CARMEL, IN (WCMH) — ITT Tech announced Tuesday that it will cease operations at all ITT Technical Institutes following a ban on enrolling students who use federal financial aid.
The company said in a statement:
It is with profound regret that we must report that ITT Educational Services, Inc. will discontinue academic operations at all of its ITT Technical Institutes permanently after approximately 50 years of continuous service. With what we believe is a complete disregard by the U.S. Department of Education for due process to the company, hundreds of thousands of current students and alumni and more than 8,000 employees will be negatively affected.
The actions of and sanctions from the U.S. Department of Education have forced us to cease operations of the ITT Technical Institutes, and we will not be offering our September quarter. We reached this decision only after having exhausted the exploration of alternatives, including transfer of the schools to a non-profit or public institution.
Effective today, the company has eliminated the positions of the overwhelming majority of our more than 8,000 employees. Our focus and priority with our remaining staff is on helping the tens of thousands of unexpectedly displaced students with their records and future educational options.
The school operated 130 for-profit schools nationwide, including one in Columbus and one in Hilliard.
In August, the school was banned from enrolling new students who use federal financial aid.
ITT was also ordered to pay $152 million to the department within 30 days to cover student refunds and other liabilities in case the company closes. The chain, based in Indiana, is still paying another $44 million demanded by the department in June for the same reason.
The education department also has prohibited ITT from awarding its executives any pay raises or bonuses, and it must develop “teach-out” plans that would help current students finish their programs at other colleges.
Last year, it enrolled 45,000 students and reported $850 million in revenue.
One of the biggest for-profit chains in the nation, ITT has been under increasing scrutiny from the education department following allegations of misconduct.
The Massachusetts attorney general sued the company in April, alleging that it misled students about the quality of its programs. The federal government had previously sued the chain, saying that it pushed students into high-cost private student loans knowing they would likely end in default.
Department officials have been closely monitoring ITT’s operations since 2014, when the chain was late to submit an annual report of its finances to the government.
Under President Barack Obama, the Education Department has led a crackdown on for-profit colleges that have misled students or failed to deliver the results they promised. In 2014, the department cut off federal aid to the Corinthian Colleges chain amid allegations of fraud, leading it to close or sell all of its schools.
Students looking for an alternative school where their ITT credits will transfer should look at the list of of schools that have articulation agreements with ITT.
The Associated Press contributed to this report.