Federal Probe Targets ITT Tech
3/2/2004 -- Classes are back to normal at ITT Technical Institute campuses across the country after federal agents raided the company's headquarters and 10 of its campuses last week in response to grand jury subpoenas and search warrants seeking various enrollment data.
Last Wednesday, agents searched ITT's Indianapolis, Indiana headquarters and 10 schools, including campuses in California, Nevada, Texas, Florida, Oregon and Louisiana. The grand jury subpoenas that triggered the searches were issued by a U.S. District Court in Houston, and sought data on student placement, retention, attendance and grades, along with recruitment and admissions materials, graduate salaries, and transfers of credits to other schools.
Classes were cancelled for the day at the targeted campuses, and students, faculty and staff were questioned. In a statement, a U.S. attorney in Houston did not give a reason for the raids. No charges have been brought against the company.
ITT spokeswoman Nancy Brown said today that the probe won't affect current ITT students, and will have no effect on anyone holding a degree from any ITT Tech school. "All the colleges are open and functioning perfectly normally," she added.
At an investor conference call this morning, ITT's chairman and CEO, Rene R. Champagne said he believes the company has had strong internal controls and that the investigation "will show that we're in compliance." Analysts who focus on the education market said the probe might be related to Title IV, a federal regulation that requires education companies to report certain student data related to federal low-income grants to states. According to company regulatory filings, about 68 percent of ITT's 2003 revenue came from federal education aid programs.
The federal raids immediately affected the company's stock, which fell from last week's high in the mid-50s to a low of $34.50 last Thursday. ITT Educational Services Inc. trades on the New York Stock Exchange under the symbol "ESI." News of the probe also affected the entire for-profit education sector, whose shares tend to fluctuate as a group. ITT was trading around $35 a share by mid-week this week, and the remaining stocks in the sector had largely returned to their pre-probe numbers. "In light of the pending federal grand jury investigation of the company and resulting shareholder class action lawsuits," Champagne said during Wednesday's conference call with shareholders, "the company is not able to confirm the internal goals and other projections for the Company's 2004 fiscal year that were previously disclosed by the company."
The dramatic drop in stock prices triggered several class action lawsuits by investors late last week - a common practice when a stock price drops substantially. The lawsuits claim the company artificially maintained or inflated its stock price by issuing false facts or omitting other pertinent ones.
ITT, with some 75 locations in 30 states, is the largest operator in the U.S. of post-secondary school technical education. It offers technology-based associate, bachelor and masters degrees in a variety of subjects, including computer programming, Web development, and engineering, to over 37,000 students. It also offers online education. According to the U.S. Department of Education, ITT granted nearly 15 percent of the total number of associate and bachelor degrees awarded in the U.S. in electronics and electronics-related programs in the 2000-2001 school year, the largest percentage of any single institution.  -Linda Briggs
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There are 166  user Comments for “Federal Probe Targets ITT Tech”
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Page 11 of 17
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| 4/9/04: Anonymous says: |
Watch out Methos, Dave will claim you live with your parents. lol |
| 4/9/04: Anonymous says: |
Don't most losers still live with their parents?lol |
| 4/9/04: Kevin from Oregon says: |
Well, "Dave" I could care less who you think I am. I was simply alerting and thanking those who were actually helpful. For the record, you are not one of them. I'm not sure why I would bother creating a fake message... not sure how it would help me or anybody else. Anyway, thanks again. I have scheduled a meeting with the school's college advisor to look over some new schools. Bye. |
| 4/10/04: Arms Longfellow says: |
My situation is similar to JoseR. At the school I attend, the teachers are fantastic. BUT THOSE NIIT BOOKS THEY HAVE STARTED USING ARE FULL OF ERRORS: spelling, grammar, syntax (visual basic labs), and in the general communication of ideas, often using very unconventional English. What in the heck is a "paradigm snippet"? It's as though they got some guy from New Delhi, who can barely speak English, to write the books. They're awful, just drab awful! I wish the staff would read some of those books so that they could understand what all the students are saying. I'm glad we're helping out the people in India, but we need to stop using NIIT books. Let me put it in a way that NIIT would understand: "There have many problem you a fix." |
| 4/10/04: Anonymous says: |
For the person who asked about Devry, I have worked in many, many for-profit education and training companies and ALL of them are the same. Phony grades, inflated placement stats and bad teachers are only the start. The Guidance Counselors or Education Consultants, or whatever title they have know they are in sales and in private they refer to themselves as the sales force. Once they lock you into the financial aid system, they couldn't care less about you. They get thier money, no mater what and you're going to pay it or have no credit for the rest of your life. PLEASE, for entry level education go to a community college and then onto a real 4 year institution. For professional training and certification (which have value), call the local office of the vendor who sponsors the certification. Ask to speak to a local systems or sales engineer. These folks know their training providers in their area and will usually point you away from the mills and to the few places that really have exceptional trainers. Protect yourself, ask to see the resume of your instructor or first "professor". I don't know one person with an advanced degree who doesn't want to show it off whenever possible(I know, I have a MPA and PhD in MIS and had to work it in somehow ;-)). If the school doesn't want to let you know specifics about the teachers, run away. The bottom line is that most of the training at the level of any tech training school is a commodity, ITT is no different from Devry or New Horizons or the schools in Career Education Corp (the nbr 2 private school corp in the US), so buy primarily on price. That means the local public colleges (2 and 4 year) win, always! Believe me, I know. |
| 4/10/04: Methos from Michigan says: |
To 4-10-04 Anonymous and any who read him: All the points you make are rock solid. I hope everyone who reads these posts takes your words to heart and follows your simple, direct, and excellent advice... I sincerely hope that everyone who reads these words realizes that, while there is a certain amount of understandable venting going on here, the concern that is paramount is that no other person has to endure what some of us continue to have to endure because of ITT (or places like them). The real goal here (despite the fact that there IS venting) is NOT to merely vent, but to help other people save themselves from a company that has very slick advertising but that has no real interest in their education. It is but ONE of the many points of shame that ITT has managed to suck into it's system, too many people at the faculty level who do care about their students...it is the goodness of these staff members that ITT has used to give itself a cloak of respectability behind which to act as unethically as it has. It has used the decency of some of it's employees and students as a cover for every sort of dishonesty. Please, everyone...follow the good advice you find on these posts and share it with everyone you know. Learn from OUR mistakes without having to learn through your own bitter experiences. We are trying to help! |
| 4/13/04: Anonymous says: |
I'm currently attending DeVry, I would not say it is neither the best school to attend nor the worse. True the graduates/potential graduates of a school reflect the operations of that school and the teachings, but we must also look at the bigger picture. Schools need money, especially private ones (like most technical schools). Accounting for the economic times we have been in and the current job environment many schools will accept almost any student for the money. Sure the graduate produced gives a picture of the how that school or organization is operated but you must also account for other factors. In the case of technical schools like ITT, AIU, DeVry, Chubb, Baurder, and so forth they have operations in many cities and states; much like a fast food restaurant say McDonald’s for example. Every time, you go to the McDonald’s on 5th and Langford you get good tasting food and courteous servers. However, if you go the McDonald’s on Pennsylvania Avenue and Ashby you get poor service and mediocre tasting food. Why is this, because each location is located in a different area, produces different employees, and is managed by different people? The same concept can be applied to the previously mentioned schools each location is located in a different area, acquires a different kind of student, produces a different kind of graduate; furthermore, each location functions differently but they all operate under the same name. Sure they all may receive the same organization goals but it is up to the teachers, deans, and other faculty to maintain focus with goals handed down from upper management, accept the correct pupil, to produce a good graduate, and to keep the students on track with goals too. But only so much can be done its still up to the student to do part of the works. Let’s say, for example purposes, you’re a student at MIT got in because you possess the financial resources to get in. Your there surrounded by great teachers, faculty, students (people that really know there stuff), but you just take it like oh whatever. What is there to be done if the student doesn’t want to do anything, sure the school could kick him or her out but how many schools really want to or can do that? In the end the student makes it through the program with a degree. The students should share at least 50% of the blame here. If a student refuses to learn the information while in school because he or she expects to be hired on the spot due to the school attended, the degree obtained, or whatever the reason may be then there's really nothing to be done. If you look at the environment today many schools are struggling for money, especially (private) technical schools because of less interest in technology as a result of outsourcing, poor economy, and numerous other reasons so they're accepting almost any student for the money. Most accelerated schools or any school for that matter, are in the business of making money, because they get you woe you this that and all that glitters. Most aren't teaching everything that needs to be taught one reason could be time another reason could be resources. In short, the generalization that this school/organization is bad because of the graduate produced is not completely true. The school/organization can take the load up to the 5th floor it up to the person carry the load up the remaining 5 floors. |
| 4/13/04: Anonymous says: |
Oh yeah its up to the students to actually study their way through and not cheat their way through as is the case in all schools (as far as I know) |
| 4/15/04: Glen from Virginia says: |
Dave, from Lake Bluff is exactly that, full of BLUFF....Get a clue Dave. If everyone on this site would say that ITT has done wonders for them, then it would be a lot different. I am also a graduate of ITT and even at eight years ago, the education still was not up to par. Yes, I did get that piece of paper that allowed me to get a job, but it's the same piece of paper that I could have received from another institution. The first thing they do at ITT is fill your head full of jargon that just makes them sound like they are the coolest thing around, when in reality they are far from it. They sit right there and tell you that grades will transfer, you will get a better job than most because you are an ITT graduate and because of that you will be paid a lot more. Again…this is far from the truth. Most people in the industry will not hire ITT Graduates, I being one of them, because we feel that they did not learn anything and what they did learn compares nothing with what a graduate from another institution would have to offer. Plus, when an ITT graduate would like to continue with their education, most are shocked to find that their grades will not transfer and many of us need to retake classes over again. Why would they tell us they transfer, when in reality they do not? They are manipulators who are wanting money and not care what happens to you after graduation. They try to place you in positions just so that it looks good for them. The don’t care if you quit they next day, but “hey we placed them.” That’s all they care about…… Dave get real. I have moved on from ITT and have become very successful at what I do. I have moved from being tagged as an ITT graduate to a respectful person who is highly depended on in my company. I make more money than most and I have the position that I do because I pulled away from ITT’s help and did everything on my own. So don’t sit there and tell me what a crybaby I am…if you could just decide to pull yourself away from that $5.00 an hour job and quit wishing you were half a man, then you would see how hard work really pays off. Open your eyes you retard….. |
| 4/15/04: Anonymous says: |
thanx, I was considering this,but no longer. A REAL college or nothing;If I can get a grant for a "shady" college, why on earth not real one? |
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