Nearly 500 former ITT Tech students in Georgia who say they were coerced by the for-profit school into taking student loans with high interest rates will receive an estimated $4.1 million in debt relief, according to a nationwide settlement announced Thursday by Georgia Attorney General Chris Carr.
Nationally, the settlement will result in debt relief of more than $168 million for 18,664 former ITT students, Carr's office said in a news release. The school, which had four campuses in Georgia, shut down in 2016 due to financial problems.
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ITT offered students temporary credit to cover their gaps in tuition costs. Students thought they could repay the credit six months after graduation but learned the money was due the following academic year, Carr’s office said.
ITT pressured and coerced students into accepting loans, which for many students carried interest rates much higher than federal loans, authorities said. ITT pressured students by pulling them out of class and threatening to expel them if they did not accept the loan terms, Carr’s office said.
The company that offered the loans, Student CU Connect CUSO, LLC, has agreed to forego collection of the outstanding loans and will cease operations.
“As Attorney General, I am committed to protecting Georgia families, “said Carr. “This settlement provides relief to hundreds of Georgia students and holds CUSO accountable for its role in subjecting ITT students to abusive lending practices.”