Feds sue college chain for risky student loans
WASHINGTON The Consumer Financial Protection Bureau says it has filed a lawsuit against a large for-profit college chain alleging that it pushed students into high-cost private student loans knowing they would likely end in default. The bureau says Indiana-based ITT Educational Services projected a default rate of 64 percent on the loans it provided, some of which had interest rates as high as 16 percent. ITT Educational Services has about 150 institutions in nearly 40 states, according to the bureau. This is among the first such actions the bureau has taken against a for-profit college. It seeks restitution for victims, an injunction against the company and a civil fine. An ITT company spokeswoman says the bureau’s claims are without merit, but she wouldn’t comment further on pending litigation.
Credit card numbers theft hurting Target’s bottom line
NEW YORK Looks like Target Corp. will be feeling the financial pain for a while from the theft of credit card numbers and other information from millions of its customers. The nation’s second largest discounter said Wednesday that its profit in the fourth quarter fell 46 percent on a revenue decline of 5.3 percent as the breach scared off customers worried about the security of their private data. While Target said sales have been recovering since the breach was disclosed in mid-December, the company expects business to be muted for some time: It issued a profit outlook for the current quarter and full year that was below Wall Street estimates. The results come more than two months after Target disclosed that personal credit card data from millions of Target customers was stolen by hackers who targeted credit card terminals in its stores.
Bill would curb electronic cigarette marketing
RICHMOND, Va. Several U.S. senators are co-sponsoring a bill that would curb electronic cigarette marketing while the fast-growing industry awaits federal regulation. The bill introduced Wednesday by California Sen. Barbara Boxer, Iowa Sen. Tom Harkin and others would ban marketing to children based on standards set by the Federal Trade Commission. Electronic cigarettes are battery-powered devices that heat a liquid nicotine solution and create vapor that’s inhaled. Harkin says e-cigarette makers are attempting to create a new generation of nicotine addicts. A 2009 law gave the Food and Drug Administration the power to regulate tobacco products, including restricting marketing. The agency first said it planned to assert authority over e-cigarettes in 2011 but has yet to do so.
The Associated Press contributed.