Durbin, Dem Senators Press Devos To Provide Automatic Closed School Discharges To Former ITT Tech Students
Senators Also Call Out DeVos On Cruel Borrower Defense Delays For Defrauded ITT Students
WASHINGTON – U.S. Senator Dick Durbin (D-IL), along with Senators Elizabeth Warren (D-MA), Richard Blumenthal (D-CT), and Sherrod Brown (D-OH), today sent a letter to Secretary of Education Betsy DeVos calling for automatic closed school discharges for former ITT Tech (ITT) student borrowers. The 2016 borrower defense rule—which is still in effect despite DeVos’ recently released revised rule eliminating protections for students—provides automatic closed school discharges for borrowers who have not enrolled in another Title IV program of study within three years of their school’s closure. Yesterday marked three years since the closure of ITT. DeVos’ new rule would eliminate automatic closed school discharge for borrowers whose schools close after July 1, 2020.
“As of yesterday, even former ITT students who have not applied for closed school discharge, but are eligible, must have their loans fully discharged,” the Senators wrote.
Last year, after a federal judge recognized a $1.5 billion claim by students in the bankruptcy proceedings based on the company’s violations of consumer protection laws, the Senators pressed DeVos to provide student loan discharges the students were entitled to. The settlement also forgave $600 million in private student loan debt owed to ITT and refunded $3 million in student payments previously made to the company. DeVos has failed to process borrower defense discharges for tens of thousands of defrauded borrowers—including thousands of former ITT students.
In 2016, ITT collapsed after years of misconduct and misleading students, shuttering 130 campuses and declaring bankruptcy. Its failure affected nearly 45,000 students, including more than 6,000 veterans – saddling them with high levels of student debt and little hope for repaying it.
Full text of the letter is available here and below: