China’s education crackdown sparks lawsuits against defunct institutions, while some tutors keep teaching in secret
- Beijing brought the hammer down on for-profit education providers over the summer, and the shock waves continue as more companies are closing their doors
- Some investors are also facing massive losses after spending millions in hopes of cashing in on China’s once-lucrative education industry
Several middle-class families from across China, including in provinces such as Guangdong, Sichuan, and Hubei, have filed lawsuits through local courts against a 22-year-old ESL (English as a second language) chain that suddenly closed several branches in the past few weeks, leaving parents angry and out large sums of prepaid tuition.
Shutoon English International and its more than 230 schools across China are buckling under China’s new regulations. In one of the complaints read by the Post, hundreds of parents in Guangzhou are suing the founder of the brand and other executives, demanding refunds ranging from around 10,000 yuan (US$1,550) to more than 100,000 yuan for each child.
Since the central government’s ban on off-campus tutoring, many Children have been unable to attend Shutoon’s classes. Meanwhile, investors who have backed the brand say their finances are in trouble.
Just one branch in Guangzhou … involves 1,500 students and more than 30 million yuan in unrefunded fees
