Summary of the Incident in Plain Language
This is a typical case of a scam in the education and training industry, where a person with a fake identity exploits prepaid payments. Li Ze, a popular blogger who claimed to be an associate professor at Tianjin University, built a following by promoting himself as a “985 university professor specializing in graduate school admissions.” He partnered with a former co-founder of an internet company to launch an education and training company that offered expensive services to parents seeking help with college admissions or graduate school placements. The most expensive package, which promised assistance in getting into prestigious universities like Tsinghua or Peking University, cost 380,000 yuan. However, after the company collected a large amount of prepaid money, its financial stability collapsed. The office was abandoned, and the company began to treat employees unfairly, forcing them to resign without compensation and owing them their salaries. At the same time, the company refused to refund the parents’ fees, offering them worthless old recorded lectures as a substitute. In the end, both employees and parents were left with no legal options and faced significant losses.
Detailed Analysis of the Incident
Why a “985 University Professor”-owned company could easily attract hundreds of thousands of parents?
The scam exploited two key areas of trust among parents:
1. The prestige of a “985 university professor.” While ordinary education bloggers might claim to understand the admissions process, the title of an associate professor at a top-tier university carries significant credibility. Parents naturally assume that such a professor has access to insider information and may be able to secure a faster path for their children’s admissions, making this investment seem like a solid opportunity.
2. The company’s pricing and product design targeted wealthy parents. Their services covered the high school to university period, with the most expensive package costing 380,000 yuan and promising to provide support throughout the four years of university. This allowed the company to collect a large amount of prepaid money quickly, without the need to build a customer base over time.
How did the company manipulate employees into resigning?
The company’s layoff process was carefully planned to minimize costs:
- They secretly disabled features on the communication platform and restricted employee communication, only allowing administrators to speak.
- On Friday, employees were notified to sign resignation agreements, and then they were removed from the work group and denied access to the building.
- The company used psychological tactics, threatening to withhold all future payments if the agreements were not signed. The initial resignation agreement was absurd, requiring employees to work for the company for free for three months after leaving and prohibiting them from contacting old clients or speaking negatively about the company. Violating these terms would result in a 100,000 yuan fine.
- The company even denied the layoff, claiming it was a mutual agreement, indicating they were trying to save every penny, even at the expense of paying employees their owed wages.
Why did the company refuse to refund fees and instead offer recorded lectures?
The company’s refusal to refund fees was a clear sign of financial distress. Parents paid for customized admission services, but with no staff to provide the promised support, the company had no means to fulfill its obligations. The so-called replacement with recorded lectures had almost no value, effectively treating the parents’ money as a loss.
The regulatory gaps exposed by the scam
This incident highlighted two overlooked regulatory issues in the education and training industry:
1. The commercialization of university identities. Li Ze’s identity as a professor from a top-tier university was used to gain trust, but domestic universities strictly prohibit faculty from participating in such commercial activities. Such claims of guaranteed admissions are often fraudulent.
2. There is a lack of regulation for high-prepaid services. Companies offering long-term services (e.g., 3-4 years) do not have mandatory third-party oversight, allowing shareholders to spend the money as they see fit. This leads to situations where both employees and parents are left without protection in case of a scam.
Three lessons for those considering expensive education services:
1. Any promise of guaranteed admissions is likely a scam. Those with the real ability to secure admissions would not publicly sell such services.
2. Avoid any prepaid services with a duration of more than three months or a total cost of over 10,000 yuan. These services are often risky investments with a high chance of failure.
3. Don’t be misled by titles like “professor from a prestigious university” or “alumni of Tsinghua or Peking University.” Such individuals are usually too busy with research and teaching to manage such services. These roles are often used as a guise for scams.
This incident highlights the risks associated with unregulated education and training services and the importance of verifying the credibility of providers.