SAN FRANCISCO, CA / ACCESSWIRE / May 13, 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.
Class Period: June 6, 2019 - Apr. 13, 2020
Lead Plaintiff Deadline: June 16, 2020
Contact An Attorney Now: GSX@hbsslaw.com
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 hired inexperienced teachers right out of college with "fabricated teachers profiles."
Then, 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 official government financials and SEC financials are irreconcilable and show a 75% overstatement of net profits for FY 2017 - 2018 alone.
Most recently, on May 7, 2020, Citron published another report addressed to U.S. regulators, 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. According to Citron, GSX uses undisclosed related entities as shell companies to move costs off the Company's books, allowing GSX to understate reported costs and appear more profitable. These revelations have driven the price of GSX ADSs sharply lower.
"We're focused on investors' losses and proving GSX deceived investors," said Reed Kathrein, the Hagens Berman partner leading the investigation.
If you purchased shares of GSX and suffered significant losses, click here to discuss your legal rights with Hagens Berman.
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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SOURCE: Hagens Berman Sobol Shapiro LLP
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