PEAKS Trust, which owned and managed loans for now-defunct ITT Educational Services, has agreed to cancel approximately 35,000 borrowers’ debts totaling $ 330 million for students Settlements with the Federal Consumer Financial Protection Bureau and 47 states and the District of Columbia.
Deutsche Bank National Trust Company, Deutsche Bank Trust Company Delaware and Deutsche Bank Trust Company Americas, which acted as trustees for PEAKS, were also named in the settlement agreement announced on Tuesday.
According to CFPB, ITT had developed two private loan programs, the Student CU Connect CUSO and the PEAKS loan program, although it was known that almost all borrowers were likely to default. To temporarily improve the balance sheet, PEAKS helped ITT use aggressive tactics to attract borrowers, in some cases without their knowledge, CFPB said.
“PEAKS reportedly knew or was ruthless in not knowing that many borrowers didn’t understand the terms of these loans, couldn’t afford them, or in some cases didn’t even know they had them,” the agency said. “ITT students have been loaded with expensive loans, derogatory information in their credit reports, or both.” –imp source
The CFPB also reached an agreement with CUSO in June 2019, in which it agreed to provide borrowers with $ 500 million in relief and no longer attempt to collect the loans.
So did the agency in August 2019 done A lawsuit against ITT in which the company agreed to pay a $ 60 million judgment and stop granting student loans.