Shares of ITT Educational Services Inc., one of the country's largest for-profit colleges, tumbled nearly 16 percent Monday after it disclosed that U.S. regulators subpoenaed documents related to private loan programs for its students.
The Securities and Exchange Commission demanded documents relating to “actions and accounting” for the programs, which helped students pay for education costs that weren’t covered by state, federal and other funding sources, the Carmel-based company said Feb. 22 in a filing.
ITT shares closed at $15.53 each, a drop of $3.10, or 16.6 percent, per share. The stock had lost three-quarters of its value in the past year before Monday.
Congress, along with state and federal investigators, has been probing for-profit college recruitment practices and student debt loads after leaving school. The SEC’s subpoena asked for documents related to agreements ITT made with outside entities to loan funds to students, according to the filing.
ITT Educational said in the filing that it is cooperating with the SEC. Lauren Littlefield, a spokeswoman, didn’t immediately return a call seeking comment.