FRANKFORT, Ky. — Attorney General Daniel Cameron on Tuesday announced a multi-state settlement with the former ITT Technical Institute.
For Kentucky students, the settlement means more than $7 million in debt relief for students with loans from PEAKS Trust, Cameron said.
Students with loans from PEAKS are not required to take action to receive debt relief and should receive notices explaining their rights under the settlement, according to a press release from Cameron's office.
Students may direct questions regarding the settlement to PEAKS by emailing email@example.com, calling 866-747-0273, or contacting the Consumer Financial Protection Bureau by calling (855) 411-2372.
The Kentucky Attorney General’s Office of Consumer Protection, together with 47 attorneys general and the Federal Consumer Financial Protection Bureau, reached a settlement with Deutsche Bank entities and PEAKS, a private loan program affiliated with Deutsche Bank and operated by bankrupt ITT.
As part of the settlement, allegations that PEAKS, Deutsche Bank National Trust Company, Deutsche Bank Trust Company Delaware and Deutsche Bank Trust Company Americas violated consumer protection laws by offering deceptive loans to finance student tuition at ITT locations in Louisville, Lexington, and across the country is resolved, according to the press release.
Indiana ITT settlement
According to the Associated Press, the Indiana attorney general says more than 1,000 students who were enrolled at now-closed ITT Technical Institute campuses in the state are eligible for nearly $10 million in student loan forgiveness.
The state’s share of a $330 million national settlement finalized Tuesday follows investigations by several attorneys general over loans the for-profit school offered
ITT closed all of its campuses nationwide in 2016, after major sanctions from the U.S. Department of Education. The agency banned ITT Tech from enrolling students who depend on federal aid and ordered the for-profit institution to more than double its reserves. ITT Tech said the financial burden was too much to bear, leaving them with no choice but to pull the plug on its operations nationwide.
Nationally, the settlement will result in debt relief of over $330 million for approximately 35,000 borrowers with outstanding principal balances.
The settlement requires the companies involved to also do the following:
- Within 30 days of the settlement, PEAKS, DBNTC and DBTCA must cancel all outstanding balances of affected student loan accounts, including fees, charges, and interest.
- PEAKS is also required to notify loan holders by mail of their canceled debt and ensure automatic payments are canceled.
- The settlement also compels PEAKS to supply credit reporting agencies with information to update the credit scores of affected borrowers, the news release states.