ITT Educational Services filed for Chapter 7 protection with the U.S. Bankruptcy Court in the Southern District of Indiana, case number 16-07207. The Company, which provides postsecondary degree programs, is represented by Jay Jaffe of Faegre Baker Daniels.
On September 6, 2016, ITT Educational Services announced that it would permanently “discontinue academic operations” and eliminate the “overwhelming majority” of its more than 8,000 employees at all of its ITT Technical Institutes. The Company states, “The actions of and sanctions from the U.S. Department of Education have forced us to cease operations of the ITT Technical Institutes, and we will not be offering our September quarter.”
The Company further notes, “This action of our federal regulator to increase our surety requirement to 40 percent of our Title IV federal funding and place our schools under ‘Heightened Cash Monitoring Level 2,’ forced us to conclude that we can no longer continue to operate our ITT Tech campuses and provide our students with the quality education they expect and deserve….We believe the government’s action was inappropriate and unconstitutional, however, with the ITT Technical Institutes ceasing operations, it will now likely rest on other parties to understand these reprehensible actions and to take action to attempt to prevent this from happening again.”
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