SAN FRANCISCO CA / ACCESSWIRE / May 21, 2020 / Hagens Berman urges investors in GSX Techedu Inc. (GSX) who have suffered significant losses to submit their losses now. A securities fraud class action has been filed and certain investors may have valuable claims.
GSX Techedu (GSX) Securities Class Action:
The Complaint alleges that throughout the Class Period, Defendants misreported GSX's financials, student enrollment figures, and teacher qualifications.
Investors began to learn the truth on Feb. 25, 2020, when Grizzly Research published a scathing report, accusing GSX of "drastically overstating its profitability in its US public filings, especially for 2018." Grizzly also claimed that GSX had generated "fake student enrollments to boost student count," and "fabricated teachers profiles."
On Apr. 14, 2020, Citron Research published its own cutting report, charging that GSX fabricated up to 70% of its revenues. According to Citron, GSX's Chinese financials and SEC financials are irreconcilable and show a 75% overstatement of net profits for FY 2017 - 2018 alone.
Then, on May 7, 2020, Citron published another report, citing "definitive evidence" of GSX "committing securities fraud." Citron avers that GSX's claims of acquiring customers at half the cost of its peers are false and misleading since GSX uses undisclosed related entities as shell companies to move costs off the Company's books.
Most recently, on May 18, 2020, Muddy Waters Research published another report, concluding GSX "is a near-total fraud," concluding that between 70-80% of its users are fake. This news sent the price of GSX ADSs crashing lower.
"We're focused on investors' losses and proving GSX deceived investors," said Reed Kathrein, the Hagens Berman partner leading the investigation.
Whistleblowers: Persons with non-public information regarding GSX should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email GSX@hbsslaw.com.
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Reed Kathrein, 844-916-0895
SOURCE: Hagens Berman Sobol Shapiro LLP
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