Investigation of TAL Education Group

TAL Education Group (TAL) Made Fraudulent Statements About its Business Prospects   

On February 4, 2022, a shareholder filed a class action on behalf of purchasers of TAL Education Group (NYSE: TAL) American Depository Shares (“ADSs”) between April 26, 2018 and July 22, 2021, for violations of the Securities Exchange Act of 1934.  TAL Education provides tutoring services to students in China.   

According to the complaint, during the class period, defendants assured investors TAL Education was complying with all applicable government policies, laws, and regulations related to the Chinese tutoring industry. In reality, defendants routinely engaged in illicit business practices designed to inflate the Company’s financial results. TAL Education purportedly: (i) engaged in deceptive advertising and promoted fake product pricing, designed to induce student enrollment; (ii) fabricated favorable course reviews, including by purported customers who did not in fact exist; (iii) forced students to pay hefty advances and take on recurring debt payments in violation of Chinese law; (iv) offered courses that gave students unfair advantages in contravention of Chinese government policies; (vi) misrepresented teacher qualifications and course qualities; (vii) mishandled user data; and (viii) rigged promotional events to defraud consumers. This conduct exposed TAL to an extreme undisclosed risk of adverse governmental action, as well as immense legal, regulatory, and reputational fallout.

On July 23, 2021, China unveiled a sweeping overhaul of its education sector, banning companies that teach the school curriculum from making profits, raising capital, or going public. On this news, the price of TAL Education’s ADSs plummeted from $20.52 on July 22, 2021, to just $4.40 on July 26, 2021, a nearly 79% decline. Just five months earlier, TAL Education’s shares traded at a class period high of $90.15.

On November 12, 2021, TAL Education announced plans to cease offering academic subjects to students from kindergarten through grade nine in mainland China by the end of December 2021. The Company stated that the cessation of these activities would have “a substantial adverse impact on the Company’s revenues for the fiscal year ending February 28, 2022 and subsequent periods.” Revenues deriving from such services have historically formed a substantial majority of the Company’s total revenues.


Next Steps: If you purchased shares of TAL Education Group (TAL) ADSs between April 26, 2018 and July 22, 2021, you have until April 5, 2022, to ask the court to appoint you lead plaintiff for the class. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.

All representation is on a contingency fee basis. Shareholders pay no fees or expenses.

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