Iowa Attorney General, Tom Miller, has secured $1.3 million in debt relief for former Iowa ITT Tech students as part of a settlement involving 48 attorneys general and the federal Consumer Financial Protection Bureau. On the national level, about $330 million has been made available in the settlement for 35,000 borrowers who have outstanding principal balances. The settlement is with PEAKS Trust, a private loan program run for the for-profit school and affiliated with Deutsch Bank. ITT Tech filed for bankruptcy in 2016 amid an investigation by state attorneys general and a recent action by the U.S. Department of Education restricting their access to federal student aid. “This settlement provides relief to Iowans who incurred debts for a questionable education at ITT Tech,” Miller says. “It also holds PEAKS Trust accountable for engaging in a scheme to benefit itself at the expense of students.” According to the Assurance of Voluntary Compliance filed in the case, ITT and PEAKS knew or should have known students would not be able to repay the temporary credit when it came due nine months later. Many students believed it would not be due until six months after they graduated. Pressure and coercion was used in efforts to get students to accept loans at high interest rates, above federal loan rates. They reportedly pulled students out of classes, threatened expulsion and a loss of earned credits if they did not accept loan terms. Many of these students were from low-income backgrounds and felt they had no choice. Students need not take any action to receive debt relief. Notices will explain their rights and benefits under the settlement. Questions should be directed to PEAKS or the Consumer Financial Protection Bureau through the contact details included below.
Questions to be directed to PEAKS:
Phone: 866-747-0273
Or the Consumer Financial Protection Bureau:
Phone: 855-411-2372
