ChinaCast Education Corp (CAST US)

ChinaCast Education Corporation provides e-learning services and content to K-12 schools, universities, government agencies and corporate enterprises in the People’s Republic of China.

The SEC alleges that ChinaCast Education Corporation’s former CEO and chairman of the board Chan Tze Ngon illicitly transferred $41 million out of the $43.8 million raised from investors to a purported subsidiary in which he secretly held a controlling 50 percent ownership stake. From there, Chan transferred investor funds to another entity outside ChinaCast’s control.  Chan also secretly pledged $30.4 million of ChinaCast’s cash deposits to secure the debts of entities unrelated to ChinaCast. None of the transactions were disclosed in the periodic and other reports signed by Chan and filed with the SEC. The fraud was uncovered by Kerrisdale Capital Management LLC, they belived ChinaCast were falsifying their financial statements and that their revenue and profit were materially overstated. These findings were then passed onto the SEC.

SEC: Press Release , 26 Sep 2013

SEC: Annual Report , 31 Dec 2010

Return to home page

Free Newsletter

GET OUR FREE NEWSLETTER

Input your email address below to sign-up to our free newsletter.