Following a decree that the for-profit university can no longer enroll students who use federal financial aid, ITT Technical Institute campuses nationwide have voluntarily stopped enrolling students entirely. Students already enrolled are being allowed to complete their studies.
“ITT is effectively out of business,” managing director senior research analyst at Piper Jaffray & Co, told CNN. “I don’t see any way they survive this.”
When reached for comment, a spokesperson for ITT Tech told the Chronicle of Higher Education that, “we have voluntarily suspended new student enrollment as we assess our options.”
Since 2014 the embattled school has been under financial and operational oversight by the U.S. Department of Education. The government in recent years has initiated a crackdown on for-profit schools, citing often deceptive advertising practices and low job placement rates. Indeed, according to the Atlantic, for-profit schools like ITT Tech on average see students pursuing bachelor’s and associate’s degrees earning less after they completed the program than they did before. This leads many students to drop out of the programs prior to completion – but not before acquiring significant debt from student loans.
By cutting the company off from access to federal money – as well as forcing the school to show a letter of credit showing sufficient funding – many are saying that this could be the end for ITT Tech.
“Frankly, it occurred to me they could file Chapter 11 pretty much any time,” Appert added. “I don’t think they are going to be able to come up with the letter of credit the DOE is demanding.”
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