Arizona ITT students obtain $4 million in debt relief through settlement
PHOENIX — A multi-state lawsuit against Student CU Connect CUSO resulted in nearly $4 million in debt relief for students in Arizona.
The settlement provides more than $168 million for nearly 18,000 former ITT Tech students nationwide who were pressured by the school to obtain loans from CUSO, according to a release by the office of Arizona Attorney General Mark Brnovich.
ITT Tech students claimed that they thought they had more time to pay off a temporary credit offered by the school but when it was realized they had to pay back the credit sooner, the school forced students into loans with CUSO and even threatened to expel some students from the college.
The release said that the interest rates on the loans were far above rates for federal loans.
“This settlement holds CUSO accountable for its participation with ITT in subjecting ITT students to abusive lending practices,” Brnovich said in the release.
The states claimed that ITT should have known that most students would not have been able to pay off the temporary credit in time and that 90% of the students who agreed to the loans with CUSO were expected to default.
ITT Tech filed for bankruptcy in 2016.
CUSO also reached a settlement with the United States Bankruptcy Trustee on Friday, pending the completion of a third settlement between CUSO and the federal Consumer Financial Protection Bureau.