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posted by cmn32480 on Tuesday May 19 2015, @04:23PM   Printer-friendly
from the money-makes-you-crooked dept.

The Center for American Progress reports:

One of the most recognizable brands in the for-profit education industry is now facing fraud charges after the Securities and Exchange Commission (SEC) filed a civil complaint in an Indiana federal court on [May 12].

The agency claims that ITT Educational Services, Inc. and a pair of executives intentionally misled investors and financial analysts about the failure of ITT's private student loan programs. The court filing asserts that ITT even went so far as to start secretly making payments on behalf of students who were in default so as to avoid having to make far larger payments to the investors who had backed the loans. It's an unusual twist on a common story in the for-profit industry, where reliance on federal tax dollars for revenue means that companies have significant incentive to manipulate statistics about how their students fare.

An SEC victory would bring relief to ITT's investors, who suffered losses when the student loan information eventually came to light and sent the firm's stock price tumbling. But ITT's students and graduates, whose inability to repay their loans on time is the prime mover behind the alleged fraud, won't see their debts alleviated or their job prospects enhanced.

The company disputed the fraud charge in a statement Tuesday, calling it an "unfair case" and welcoming the chance "to have the court clear our reputation that has been unnecessarily endangered by the SEC's action."

 
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  • (Score: 0) by Anonymous Coward on Tuesday May 19 2015, @07:37PM

    by Anonymous Coward on Tuesday May 19 2015, @07:37PM (#185201)

    Anyone that goes to a for-profit school is a dumbass.

  • (Score: 3, Informative) by Tork on Tuesday May 19 2015, @07:51PM

    by Tork (3914) Subscriber Badge on Tuesday May 19 2015, @07:51PM (#185204)
    You'd think I would agree with you since I'm self-taught and successful. But the problem is life has shown me that it's not as clear cut as that. At a place I worked we needed to staff up. My supervisor and I knew an instructor at a private school and we asked him to send us five of his best students. All of them soundly kicked butt and, frankly, you've seen and enjoyed their work. They're all still employed, 3 of them enjoying staff jobs and the other two are constantly busy running around and consulting.

    I don't really disagree with the spirit of your comment, rather just the letter of it. Whether you're self taught or you go to a private school whatever you get from it depends on what you put into it. These five people went to that school and kicked enough butt to get noticed. The rest of their 30 or so classmates, not as much. I don't know what happened to them but if at least 5 of them moved on to different careers I would not be surprised at all. If I'm right, they're probably still paying that off. Frankly, if I didn't do enough work to make this career a possibility, I'd be in the same boat. Perhaps not as much debt, but also I may not have gotten here because I'd rather watch youtube videos of cats than sit at home doing work.
    --
    🏳️‍🌈 Proud Ally 🏳️‍🌈
    • (Score: 0) by Anonymous Coward on Tuesday May 19 2015, @08:41PM

      by Anonymous Coward on Tuesday May 19 2015, @08:41PM (#185212)

      First, gotta get the pedantry out of the way - all for-profit schools are private schools, but not all private schools are for-profit schools.

      As for those butt-kickers, my first stab at explaining that would be to think of it like a glass of water. Everybody comes in with a different amount of water and the school siphons off the same amount from each of them. The people who start off with with a near full glass can still come out the other end with enough water to succeed. The people who start off on the low side may end up being sucked dry. Obviously the reality is not nearly so one-dimensional as that. But I'd be more inclined to say that they succeeded in spite of the school rather than because of it, if they had taken another path they might have done even better.

    • (Score: 2) by aristarchus on Tuesday May 19 2015, @09:48PM

      by aristarchus (2645) on Tuesday May 19 2015, @09:48PM (#185221) Journal

      C'mon, Tork, your anecdote is not making anything any clearer!

      At a place I worked we needed to staff up. My supervisor and I knew an instructor at a private school and we asked him to send us five of his best students. All of them soundly kicked butt and, frankly, you've seen and enjoyed their work.

      The super knew the instructor, not the school, and hired the instructor's five best, who may have not been the school's best and who many not have learned anything at said school. So other than the fact that the super knew someone whose judgment was trustworthy who happened to the an instructor at a for-profit school (some times a job is just a job, when it comes to teaching), what does this have to do with the quality of education at for-profit schools?

      You know that Einstein went to a for-profit school? Seriously! They got him a job in a patent office! Top-notch placement rates! But you know who else went a for-profit art school? --Wait for it!--- Hitler!!! He did not get a job and was forced to go into politics. (For the sarcasm impaired: neither of these anecdotes are true, in case you were wondering.)

      • (Score: 2) by Tork on Tuesday May 19 2015, @10:11PM

        by Tork (3914) Subscriber Badge on Tuesday May 19 2015, @10:11PM (#185227)

        So other than the fact that the super knew someone whose judgment was trustworthy who happened to the an instructor at a for-profit school (some times a job is just a job, when it comes to teaching), what does this have to do with the quality of education at for-profit schools?

        They arrived already trained to do the job we assigned them. Either they learned that at the school they attended or they failed to put valuable work experience on their resume that would have earned them higher pay.

        --
        🏳️‍🌈 Proud Ally 🏳️‍🌈
  • (Score: 1) by Ethanol-fueled on Tuesday May 19 2015, @11:40PM

    by Ethanol-fueled (2792) on Tuesday May 19 2015, @11:40PM (#185244) Homepage

    There are some people around here who are successful with for-profit Master's Degrees, but they all got their bachelor's at a State School or an otherwise more legit place and just need some more resume padding.

    ITT Tech will get you an hourly entry-level technician job making between 10 and 20 (most likely starting around 15ish) bucks an hour depending on your previous experience.