In 2016, ITT Tech closed its doors, which included a campus in Madison, Mississippi. The closure left students with big debt, no degrees, and according to reports, many had no credits to transfer for continuing education.
Mississippi Attorney General Lynn Fitch has secured an agreement to obtain over $1 million in debt relief for former ITT Tech students in Mississippi as part of a settlement with 48 attorneys general and the federal Consumer Financial Protection Bureau.
“Today’s settlement will deliver more than $1.7 million directly into the pockets of students targeted by PEAKS Trust’s predatory actions, many of whom continue to suffer the economic impacts of astronomical interest rates,” said Attorney General Lynn Fitch. “This settlement should serve as a warning to other bad actors who take advantage of financially vulnerable Mississippians. My office will continue to seek justice, ensuring there are severe consequences for illegal actions against consumers in our state.”
Nationally, the settlement will result in debt relief of approximately $330 million for 35,000 borrowers who have outstanding principal balances.
The settlement is with PEAKS Trust, a private loan program run by the for-profit college, ITT, and affiliated with Deutsche Bank entities. PEAKS was formed after the 2008 financial crisis when private sources of lending available to for-profit colleges dried up.
ITT developed a plan with PEAKS to offer students temporary credit to cover the gap in tuition between federal student aid and the full cost of the education. ITT filed bankruptcy in 2016 amid investigations by state attorneys general and following action by the U.S. Department of Education to restrict ITT’s access to federal student aid.
Former students will need to do nothing to receive debt relief.
The notices, which will be sent directly to those affected, will explain their rights under the settlement. Students may email questions to PEAKS or call 866-747-0273. You can also reach out to the Consumer Financial Protection Bureau by calling (855) 411-2372.
In addition, Mississippi was part of a $168 million settlement in June 2019 which resulted in debt relief for over 18-thousand former ITT students. That agreement was with Student CU Connect CUSO, LLC, which also offered loans to finance students’ tuition at ITT Tech.