|March 4, 2014|
Previously published on March 3, 2014
On February 27th, the CFPB filed suit in federal district court in Indiana against a for-profit college, alleging that the college engaged in unfair, deceptive, or abusive practices in the marketing and financing of its degrees.1 The CFPB is also alleging a violation of the Truth in Lending Act. Among other allegations, the CFPB alleges the following conduct:
Financing. The CFPB alleges that the college pressured students during an automated application process without providing them a fair opportunity to understand the private student loan obligations involved.
Job prospects. The CFPB alleges that the college misrepresented to students that when they graduated they were likely to earn sufficient income to repay their student loans.
Default prospects. The CFPB alleges that the college knew that approximately 64% of its students would default on their private student loans.
The CFPB is seeking restitution for students, a civil fine, and an injunction against the college.
1 See the complaint here http://files.consumerfinance.gov/f/201402_cfpb_complaint_ITT.pdf