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 8 of 17
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| 3/24/04: AYE from COLORADO says: |
How if we are crybabies was I able to do these things from skid row? I am not ashamed of means; the ends out weight the means. I was successful when I taught myself algebra in one night, just so I could get into Itt. Now I know that what I have ascertained here today sounds like a lot of hoopla, but if the GOD above sees fit, you will eventually see me. The reason I am saying take out an ad in USA Today is because their publication is national and international. So we have the potential of reaching all of those of whom who have suffered as we have. My HR and my payroll departments did not even notify me that there was a garnishment on my salary. Take out the ads; we will all see Itt in court. It does not matter who I am but my initials are AYE, they are not in the right order. Also I will be looking for more threads like this one to post my same letter I am posting here. Oh and yes I used a word processor to write this letter, when typewriters were the latest technology out, I used them too. TAKE OUT THOSE ADS!!!!!!!!!!!!!!!! See ya in court! Watch also for Itt to trace me over the net, and when they do, and believe me they will, it will be a first step in fighting them for what they have done to so many. I’m not ignorant; else I could not use the language as I have on this letter. If all of you are serious I will see your ad in USA today. AYE, Colorado P.S. Itt this is where to look for me……………………………………………. |
| 3/24/04: second aye from colorado says: |
I am not ashamed of the means; the ends out weight the means. I was successful when I taught myself algebra in one night, just so I could get into Itt. Now I know that what I have ascertained here today sounds like a lot of hoopla, but if the GOD above sees fit, you will eventually see me. The reason I am saying take out an ad in USA Today is because their publication is national and international. So we have the potential of reaching all of those of whom who have suffered as we have. My HR and my payroll departments did not even notify me that there was a garnishment on my salary. Take out the ads; we will all see Itt in court. It does not matter who I am but my initials are AYE, they are not in the right order. Also I will be looking for more threads like this one to post my same letter I am posting here. Oh and yes I used a word processor to write this letter, when typewriters were the latest technology out, I used them too. TAKE OUT THOSE ADS!!!!!!!!!!!!!!!! See ya in court! Watch also for Itt to trace me over the net, and when they do, and believe me they will, it will be a first step in fighting them for what they have done to so many. I’m not ignorant; else I could not use the language as I have on this letter. If all of you are serious I will see your ad in USA today. AYE, Colorado P.S. Itt this is where to look for me……………………………………………. |
| 3/24/04: Anonymous from ATlanta GA says: |
How about AIU in Atlanta another questionable operation |
| 3/25/04: Former Employee from Tampa Bay says: |
The dirty little secret of ITT Technical Institute is that one third of your tuition is budgeted for marketing and recruitment efforts. That is, if you are paying $30,000 for an ITT Technical Institute education, $20,000 is budgeted for education expenses and $10,000 is budgeted back to the marketing and recruitment department. |
| 3/25/04: Anonymous says: |
How true wambulance. We have no one to blame but ourselves! |
| 3/26/04: Marlena from Dayton says: |
This school sucks! I don't know much about how colleges and the like work (I didn't even go to high school) But I do know they keep telling me I need to pay more money or take an entire quarter off! One of the people I am enrolled with went to one VB class, turned in no homework, let alone any exams or quizes. Yet she passed and is at school right this minute taking her second VB class. While I sit here trying to figure out just how to stay in. Our VB teacher was an absolute joke, he didn't teach us a damn thing. Had I investigated this school better I would have known these things and saved myself alot of time, money, and frustration. I only can blame myself for about the next twenty years while I pay these jackasses back after having to teach myself VB at a cost of around 40 thou. |
| 3/28/04: Anonymous says: |
Is this an American thing? In Australia we like to attend university for education after high school. I didn't know you could just sign up with a company to get a degree. The USA must be very progressive, actually its amazing you can just pay for a degree off the shelf like that. |
| 3/30/04: Randy from Indiana says: |
I worked with alot of students who went to ITT. Most of them didnt know any more than someone with a Cert. It's a shame to because we all worked the same job (most of us didnt even go to school) and when it came time for promotions in the technical department they chose the people with the most knowledge and when it came time for promotions in management they always took people from 4 year accredited universities. Many of the ITT students complained about their education saying it was less than adequate for what they payed. |
| 3/30/04: Anonymous says: |
I wish I could have gone to ITT after reading this. I would have paid the money and got my diploma thus enabling me to spend most of my time surfing while I'm still young enough to enjoy it. Damm, it looks like I've missed out now. |
| 3/30/04: reggie from memphis says: |
I getting very unplease how the school has done me this quarter I'm a straight A student and I had a problem with one of the instructors, not teaching me properly and not only that she have giving me an F for the quarter. She had me to turn in some work, but she claims it was late and that she cannot accept it, so therefore, I must received an F. So I went to Asst Dean he didnt do anything and then I talk to the Dean himself and he seems be confuse about it. I prove to him with the email that i sent her,that it was on time but he still hasn't got back with me on my grade changing back to a passing grade. I check with the rest of the student body and about 81% of her students have fail her class and not only that most of them didn't get a true understanding of her teaching. I have talked and meet with different people in the school, my next step is taking this a little more higher for results.... |
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