U.S. forgives $3.9 bln in federal loans for ITT Tech students

ITT Educational Services

16/08/2022 15:59

WASHINGTON, Aug 16 (Reuters) - Former students of ITT
Technical Institute will not have to pay $3.9 billion they still
owe in federal student loans to the now-defunct for-profit
college, the U.S. Department of Education said on Tuesday.
    ITT Educational Services Inc, which ran ITT Technical
Institute, closed its roughly 130 campuses and filed for
bankruptcy in Sept. 2016, amid growing regulatory scrutiny of
for-profit colleges' recruiting and financing practices.
    The loan forgiveness will cancel student debt for 208,000
borrowers, the department said in a statement. "It is time for
student borrowers to stop shouldering the burden from ITT's
years of lies," Secretary of Education Miguel Cardona said.
    The department also said it had formally notified DeVry
University that the for-profit school is required to pay $24
million in approved borrower defense claims. The department said
DeVry had misled prospective students about graduates'
employment prospects, a charge the school has denied. 
    Student debt cancellation has become a priority for many
liberals and one that could shore up popularity with younger and
more highly educated voters, who lean Democratic, before
November's midterm congressional elections.  urn:newsml:reuters.com:*:nL2N2XJ0O2
    Last month, President Joe Biden said the government would
cancel $6 billion in student loans for 200,000 borrowers who
claimed they were defrauded by their colleges.  urn:newsml:reuters.com:*:nL1N2YA1UV

 (Reporting by Rami Ayyub; 
Editing by Sandra Maler)
 ((Rami.Ayyub@thomsonreuters.com;))