ITT Technical Institute exaggerated its job-placement rates by counting "any job graduates got that somehow involved the use of a computer" and misled prospective students about the quality of its programs, according to a lawsuit filed Monday by Massachusetts Attorney General Maura Healey’s office.
The for-profit educational giant is accused in the lawsuit of using high-pressure recruitment tactics and enrolling students from at least 2010 through May 2013 based on misleading information.
According to the lawsuit, ITT Tech admissions staff told potential students it had an 80% to 100% job placement rate when the actual rate was around 50% or less. To inflate the numbers, ITT Tech allegedly counted jobs that fell outside students' field of study, including jobs selling computers at big box stores.
ITT Tech also placed heavy pressure on its representatives to bring new students to the schools. According to the lawsuit, recruiters were expected to call as many as 100 people per day and were publicly shamed or fired if they failed to meet their quotas.
In a statement Monday, parent company ITT Educational Services Inc., based in Indianapolis, characterized the suit as a continuation of a "wide-ranging fishing expedition that lasted for more than three years" on the part of the Massachusetts Attorney General. “Although [ITT] cooperated fully in the investigation and presented evidence that its conduct was lawful,” the statement continued. "Some of the claims rest on a biased and selective portrayal of the facts.”
ITT officials added that Healey’s office failed to explain how it calculated its estimates for job placement rates and calling such calculations unreliable. ITT further referred to the lawsuit as proof of “Massachusetts' woeful record of hostility toward career colleges that train non-traditional and underserved students."
ITT Tech has two schools in Massachusetts. The lawsuit is the latest in a long string of investigations into ITT Educational Services' practices.Fifteen former students sued the technical college in 1998, claiming they had been duped. The school settled its claims later that year.
The Consumer Financial Protection Bureau in 2014 sued ITT Educational Services for predatory student lending, stating that the school pressured students into predatory loans, coerced them to continue taking classes by making their credits nontransferable to nonprofit institutions and mislead students on future job prospects. That same year, the New Mexico Attorney General's Office also filed suit.
In 2015, the Securities and Exchange Commission charged ITT Education Services Inc., its chief executive officer Kevin Modany and its chief financial officer Daniel Fitzpatrick with fraud.
Attorneys general in at least 17 states and the District of Columbia also opened probes into the company's practices.
Approximately 40,000 students attend ITT Technical Institutes at more than 130 campuses in 38 states, according to to the company.