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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| 3/10/04: Instructor says: |
What’s happening at ITT is happening at other schools. They have become just like the clients they are supposed to be helping. They are living off government entitlements. Without students that receive federal/state funding their enrollment would be way down and I would guess that some campuses might even close. The majority of the funding is for worker retraining to get them off welfare and unemployment. If you have ever taught this type of student you know it’s not an easy task. But as an instructor you do your best and often go above and beyond to help them. Many of these students wash out after a few weeks. Others genuinely want to succeed, but they just can’t seem to. As adult learners many of these students have learning disabilities and bad study habits. Old habits are hard to break. The best part about teaching this type of student is when they do get and they do succeed. But there really is a dark side to all this. Many of the grants require the student to complete the class or become certified in order for the school to be paid. This is why you see schools falsifying records. This is absolutely a practice I disagree with. Just like one of the other instructors explained, I too was asked to change attendance records to show a student did come to class so the school could be paid. I refused. The school director then went off and changed them on her own (hearsay). The owner of this school also runs a local government agency office. They use this office to send a constant stream of students to their privately owned company. The law states that each student shall be given a list of training providers. I guarantee you this does not happen. The students are just directed to his school. In Michigan there is currently funding available as part of the H1B-Visa grant. There are many metrics required to be reported regarding students whom receive this funding. Again the school is falsifying data. The students are getting certificates of completion, not certifications (Microsoft, Cisco, CompTIA). We all know a certificate of completion is not professionally recognized, it’s the Certification that is. The job data regarding the students is also fudged and skewed. Should they ever get caught, well they will have to repay all the monies they received. I think over the next few months there will be a much larger industry shakedown. This is only the tip of the iceberg. So this problem runs more rampant and deep than many realize. I think we need this type of funding to help change peoples lives. This also brings more entry level techs into the industry which may help lessen the outflow of jobs to India. But I also think we need more accountability in the industry and a better system for auditing the results. |
| 3/11/04: Stinga says: |
Is Devry the same way? |
| 3/11/04: Anonymous says: |
Wow, I can not believe that ITT has been pulling this off for so many years. For you current students: Keep your head up |
| 3/11/04: Disturbed In Pennsylvania from Monroeville Pennsylvania says: |
I'm a March 9th 2004 grad from ITT (CNS)....where do I begin?!?! 1st my husband started at ITT at the same time as I did,he made it almost through his second quarter when financial aid notified him that his paper work wasn't sent in at the proper time so his student loans did not come through...they want $4500 cash payment...was kicked out and we are still getting hounded for payment. Finacial aid admitted to late paperwork, but said it was our fault for not catching it!! I went 6 quarters of schooling and made highest honors...out finals were handed to us as review sheets and the answers were given to us for the review..we were told "miss a few". One teacher we had for 4 classes, well, we learned more about his corvettes (cars) than anything! The entire class complained and he was relieved from him teaching any more networking classes he currently doing web design..BUT they didn't change his schedule until he was done with ours!! 7th and 8th quarter networking teachers were extremely helpful with trying to help us catch up and learn a few things ( our class learned NOTHING) but they grew more frustrated than anything else. ALL ITT staff was aware of that problem. We have complained as a class on several occasions of lack of equipement, failed networks, computer shortage, useless books (many of mine never even used), lack of instructor knowledge, misuse of time (starting at 5 and leaving at 7)and the list goes on...did anything change??? Guess that answer!! 2 of the teachers that signed our written complaints no longer teach there....that was the change. Why didn't I quit?? I already had THOUSANDS invested which would have to be immediately paid back...mother of 2 and a low paying job doesn't have funds to pay back loans right away!! I figured if I atleast had a that piece of paper saying I finished, I could hopefully find a better paying job....I make more NOW than what I will make taking a job that ITT has soooo properly educated me for! I would LOVE to find out how I can get in touch with someone to show my records to, and get our school investigated. Unfortunely, ITT's seem to be the same across the country...where do we go from here?? |
| 3/11/04: Adam from Grand Rapids, MI says: |
Integrity issues seem to run rampant in the private technology education sector. When I decided to go back to school I was told of the National Institute of Technology's Network Administration program and decided to check it out. I made it clear to the recruiter that I intended to pursue my Bachelor's after attending NIT and inquired about transferrability of credits, specifically to Ferris State University. I let him know I'd already spent a year and a half at the University of Michigan in '91 and '92 and was looking at this program as a way to rack up a lot of credits in a short amount of time. He told me straight to my face that FSU accepted all credits from NIT and so did several other local colleges. I signed up and was less than impressed with the school. The set up there was a 15 month diploma program, taught straight through with the same instructor for all topics. The school changed campus location and was renamed to Olympia Career Training Institute three months into the program (which we were made aware of immediately after starting classes), I had four different teachers because they kept leaving due to their unhappiness at the institution. At the end of 12 months (January 2002), going through 4 hours of class per day, four days per week (16 hours), I was told I would not qualify as a full-time student for financial aid for the last semester. The best aid they could set up was a loan for $4,500.00 at 19% interest. At that point, two weeks before the beginning of the final semester, I told the financial aid officer that I wanted to speak with Ferris State University to see how close I was to my Bachelor's degree and would most likely tranfer without graduating. I verified that I wouldn't have to pay for the final semester since I would not be attending at all and made an appointment with FSU for that afternoon. The admissions counselor I met at FSU was disturbed by my situation because I was one of many OCTI students that had come to him claiming the institute's credits would transfer. There was never any articulation between the schools. I had just been told that I'd wasted a year of my life and $13,500.00... wasted in the fact that I'd been trying to get closer to my Bachelor's degree, not that I didn't learn anything. I did learn quite a bit, not $13,500.00's worth, but I did learn. Anyway, I verified again that if I dropped out of OCTI at that point I would not be responsible for payment on the unattended semester and then I dropped out. I started attending Grand Rapids Community College shortly thereafter and have been very happy. A few weeks after leaving OCTI, I started getting letters and phone calls from OCTI regarding the payment for the semester I didn't attend. I spoke with several people at the institute and their parent company (Corinthian Schools Inc.) and was being told by everyone that somebody else had to handle this. I confirmed that they hadn't contacted a collections agency throughout my communication with them. On the day I was told by the president of the institute that he would call me with an answer as to what actions the school would pursue (dropping it or continuing to seek payment), I was called by a collections agency. I explained my situation to them and they held off any action. I hadn't heard anything for a couple of months and then was called by the institute asking about when they could expect payment. I explained that I'd been dealing with this for a total of seven months and would not be paying. At that point I was notified that the entire staff, save the financial aid person that assured me I would not be liable for the unattended semester, had been replaced and I was now back to square one. After getting the same treatment from this new staff and their parent company (still CSi). I decided to hit them where they were trying to hit me. I stood outside the entrance to the campus with a sign reading "Olympia Lied to Me" on the front and "Did They Lie to You, Too? Ask Me" on the back for students entering class to see. I was out there as students and staff arrived for the day. Less than an hour later I was approached by staff and had the whole matter dropped by noon. They said they'd been working hard behind the scenes and would have had this dropped on that day, saying my protest had nothing to do with it. So after nine months of trying to be civil, it just so happened my resolution was scheduled to take place on the same day I just happened to protest. This appears to be the standard mentality of people involved with the private technology training institutes - lies to cover lies. I asked for written confirmation of the dropping of this debt on several occassions and have been assured they would send me something stating such. I've never received anything in writing. Luckily, I audio-taped all of my phone conversations and conversations in person (which is legal in Michigan), so when the next new staff enters I already have |
| 3/11/04: Adam from Grand Rapids, MI says: |
... my back covered. These "schools" are as shady as it gets. When I got my first IT job, my boss actually told me he almost DIDN'T hire me BECAUSE I had attended a private technology institute. This was based on his previous experience with the incredibly low-quality employee these schools tend to churn out. Please, if you're contemplating a career in the IT field, DO NOT put yourself through what so many of us have gone through. Enroll in a real college and pursue certifications on your own. |
| 3/11/04: Dan from Wisconsin says: |
I have earned a Master’s degree in “Technology in Education”. I have passed the Cisco Examination and am a recognized CCNA. Currently, in addition to teaching for the Wisconsin Public School system, I serve as an adjunct professor for a real, accredited University, conducting technology classes for graduate students. I have ample years experience as a technology instructor. The worst professional experience of my life occurred in the one year I was employed by ITT Green Bay, WI campus. I accepted the position of “full time” instructor. Within one year I was promoted to Program Chair of the IT Department. I also served as the campus network coordinator. In addition, the Registrar and I were sharing the Dean’s responsibilities. The Dean had resigned months prior to my “wrongful” termination. My “wrongful” termination came quick and with no prior warnings. My initial reaction was to think this was just a personality conflict between the campus director and myself. With more reflection, I now believe that this devious act was a cost cutting tactic, as I was the highest paid employee on campus. I have numerous other examples of ITT’s poor administrative practices in Green Bay. Some of which I can verify with documentation. This investigation has made me aware that the corruption in ITT is much larger scale than just Green Bay. They claim they are the “business of education” and “college for profit”. However they are much more concerned about “business and profit” than “college and education”. |
| 3/11/04: Torn from ca says: |
Im a second quarter student at ITT, transfer from GA State Univ ( 2 solid years ) The ITT recruiter seemed like a used car salesman to me. They claim to offer tutioring, if needed. But trying to arrange it is impossible. Although I made As, I feel like I did not learn much. Im transfering out this quarter. Follow your gut feeling. IS THERE ANOTHER MESSAGE BOARD OUT THERE SOMEWHERE ABOUT ITT?? |
| 3/11/04: Becky Nagel from Editor, CertCities.com says: |
Hi Everyone -- Many of you have mentioned wanted to share more about your experiences. We're now working with a journalist looking into ITT Tech. If you're interested in sharing your experiences (good or bad) as a student or instructor for a possible article, please send an e-mail with your name and job title, a daytime phone number, and a one-paragraph description of your experience with ITT to [email protected]. NOTE: Make sure that the subject line reads: "ITT TECH". We'll pass your informaiton on to her for future contact. Thanks! -- Becky |
| 3/11/04: Sorry to hear it from Pittsburgh says: |
I am sorry to hear that most of the people posting on this are unsatifsfied. I believe like a lot of people do that you get in what you put out. I cant speak for all of the schools but my school impaticular has done an excellent job (overall). Sure you have a teacher here or there that maybe good be upgraded but you have that everywhere. I am in the 7th quarter in the CNS program and can honestly say that the course has been a good one. I have attended several schools and talked to several people about education and one thing has held true. When you get your degree you are not going know all there is to know. If you go into school expecting that, you need to reaccess your goals. Building your career is like building your house. The education is just the foundation being laid. You have to get real job experience. Most of the time the only way you can do that is by attaining the education. That leads right into my next topic the career service counselors. Our staff has done a comendable job assisting all of the students who have actively pursued getting employment. I personally was lined up with a paid IT internship position after 3 months of being at school. I know several of my fellow students have recieved employment in their respective fields. As a whole the entire faculty at my school has done a tremedous job and I feel they should be commended. Unfortunately I know that not all schools are going to operate like this, however if you are persistent in what you want to do then put everything into this school and I would be willing to bet that you will get a lot more out of it. |
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