Wall Street English thunder, education loan has not been paid off,
experts analyze the legal issues behind the bankruptcy of training institutions
● The current dilemma faced by many trainees is: on the one hand, the training institution has been reluctant to refund the fee, and on the other hand, they have to repay the loan to the Internet loan platform
● If the relevant staff of Wall Street English knowing that the company is about to go bankrupt and have no ability to perform the contract, they still induce the students to pay fees and defraud the property, it may constitute the crime of contract fraud
● The problem of education loan disputes caused by the Wall Street English thunder is due to the lack of new risk control methods under the new business model of the platform economy
□ Our reporter Zhao Li
□ Intern Yang Yinan
238 lessons, with a total price of 442,000 yuan, 180,000 yuan has been paid, and there are more than 260,000 yuan in loans to be paid off-this is the price Tian Yanli paid to improve her oral English.
But after 19 classes, the training institution was going bankrupt.
This training organization is Wall Street English. It was founded in Italy in 1972. Since entering the Chinese market in 2000, it has opened 71 learning centers in 11 cities in China. Zenghe EF Education and Weber English are called "Adult English Training" Big Three".
Recently, the institution's thunderstorms have continued to ferment.
Like Tian Yanli, many students who applied for loans fell into the predicament of having to pay back their loans without classes, and the risks of scene finance resurfaced.
A reporter from the "Rule of Law Daily" communicated with students in a number of rights protection WeChat groups and found that many students are currently facing a dilemma: on the one hand, training institutions have been reluctant to refund fees, and on the other hand, they have to repay loans to Internet loan platforms.
What will happen to these students who are deeply involved in education loans?
Is it possible to get back the money that has not been consumed?
Is the practice of Wall Street English training institutions persuading students to apply for education loans against the regulations?
How to avoid scenario financial risks?
The journalist made an interview about this.
Vigorously promote various courses
Many students apply for loans
On August 14, Tian Yanli made an appointment with the teacher as usual, but was told that "the course is over."
Her head buzzed, and she immediately searched for relevant information on the Internet, only to find that the Wall Street English store where she was attending classes was closed recently, and the centralized rights protection of employees and students frequently appeared.
Tian Yanli, who runs a medical beauty clinic, often attends foreign medical conferences and communicates with foreign doctors.
Although she has a certain amount of English reading and writing skills, but her oral expression skills are not good, she wants to apply for a training class to improve.
Under the recommendation of sales, Tian Yanli finally chose one-to-one small class: from January 18, 2021 to January 5, 2026, a total of 238 classes and a total tuition of 442,000 yuan.
"At that time, I wanted to pay money year after year, but the sales suggested that'the more you pay, the more favorable', and proposed a loan to pay the tuition fees, recommended the loan company to me, and said that if you take a loan, you only need to repay every month. 10,000 yuan." Tian Yanli recalled that considering the high cost, she used a credit card loan of more than 260,000 yuan after paying 180,000 yuan, which was paid off in three years.
Also attracted by words such as "the more you report, the more favorable", "the more expensive the course is, the loan is not much money every month" and so on, there is also Wang Hua, a freelancer in Beijing, who took a loan of 270,000 yuan from the bank. class.
According to Wang Hua's recollection, the VIP course was initially recommended by the seller, because the course will proceed normally regardless of whether the students go to the class or not.
However, the cost of one-to-one lessons such as VIP is quite high, so the sales recommended to him Duxiaoman Finance and Bank that can lend.
"Sales said that they have cooperation with these financial institutions, and the interest is relatively low, and they can also help with the approval process." Wang Hua said.
In addition to people like Tian Yanli and Wang Hua who are already working and have a certain ability to repay, there are also some school students who are actively recommending that they choose to pay the tuition prepayment in advance through loans.
Liu Lin is a college student. In order to improve his English scores, he spent more than 100,000 yuan on Wall Street English classes.
After sales recommendation, she borrowed a lot of money from Huabei.
"I don't have a job, and I don't have a stable source of salary. Why would they still recommend loans? Don't you need to do risk control?" Liu Lin expressed his confusion to the reporter.
Another student who paid more than 100,000 yuan in tuition also introduced to the reporter that when talking to the salesman about the renewal, the other party did not ask about his salary at all.
When the trainee clearly expressed the idea that "ordinary office workers, the salary is not high, and the tuition fees are too expensive", the sales still used various excuses to persuade him to apply for the loan.
The reporter interviewed more than 10 students at random and learned that Wall Street English sales generally encourage students to upgrade their fees, apply for loan business, etc. The difference is that some sales will confirm whether the student has graduated, what job they are engaged in, and whether they have the ability to repay, etc. , And some do not consider risk control at all, saying that the platform can solve the loan problem.
According to incomplete statistics from the reporter, the loan products that Wall Street English students are using or have used to pay for training costs involve Duxiaoman Finance, China Merchants Union Consumer Finance, Ping An Bank, Shanghai Pudong Development Bank, North Bank Consumer Finance, WeBank Microfinance, The ants waited.
If you know you are about to go bankrupt
Suspected crime in inducing renewal
It is worth noting that two or three months before the Wall Street English thunder, some salesmen continued to persuade students to renew their fees.
According to Tian Yanli, her course was supposed to end in 2026, but more than a month ago, the sales team promoted her, suggesting to continue to buy the course, and promised to provide more concessions.
"If I want to sign up, I have to spend another 200,000 yuan. Fortunately, I refused." Tian Yanli said.
Another student with the online name "Don't Ask Things" was promoted in May this year to continue the upgrade course.
"Wall Street English has an activity. If you complete a level of study, you can extend the study time by one month. I completed the study, but the contract did not extend my study time. At the same time, Wall Street English changed another course. Consultant, continue to sell me the course and ask me to pay more than 100,000 yuan."
In fact, as early as 2018, the General Office of the State Council issued the "Opinions on Regulating the Development of Off-campus Training Institutions" stipulating that a one-time fee that spans more than 3 months should not be charged.
Obviously, Wall Street English did not comply with this rule.
According to Xu Wei, a lawyer at the Kyoto Law Firm, the public security organs have specially "customized" the report registration form, which shows the large number of report students.
The main reason for the trainees to report the case was that Wall Street English still induced them to pay high fees on the eve of bankruptcy, causing huge economic losses to the trainees.
Article 224 of the Criminal Law stipulates that “without the actual ability to perform the small contract first or partially perform the contract to trick the other party into continuing to sign and perform the contract” is a contract fraud.
"If Wall Street English personnel knowing that the company is about to go bankrupt and have no ability to perform the contract, they still induce the students to pay fees and defraud the property, it may constitute the crime of contract fraud." Xu Wei said.
Xu Wei reminded that "Wall Street English" is only the name of the brand. Some students said that "Wall Street English commits fraud" and "requires Wall Street English to bear criminal responsibility" are not accurate. It depends on the specific implementation unit or natural person. Determine exactly who is responsible.
He explained that Wall Street English is operated by multiple subsidiaries. If the induced payment exists and the specific implementation unit of the induced payment cannot be specified, it is impossible to judge who should bear the responsibility.
"If the induced payment is made by the parent company, namely Peicheng Technology Development (Beijing) Co., Ltd. and Hong Kong Gamma-Master Co., Ltd., the parent company may be suspected of contract fraud and unit crime, the relevant supervisor or directly responsible person Also bear responsibility; if the inducing payment is implemented independently by some subsidiaries, the subsidiary may be suspected of contract fraud and unit crime, and the relevant supervisors or directly responsible persons shall also be held responsible; if the inducing payment is only part of the management personnel or If implemented by an individual employee, the relevant staff member may constitute a crime of contract defrauding natural persons." Xu Wei said.
Education loans still have to be repaid
It is difficult to recover losses
Many trainees told reporters that due to late repayment, their credit records have been affected.
From the feedback obtained from the communication with the bank, there is no credit protection measure introduced, and the students must repay the loan on time.
"I borrowed the money from the personal credit card of China Merchants Bank, which was collected through personal credit, so I have to pay back the money. I have filed a report and am going to the court to file a case." Tian Yanli said.
Yin Zhentao, director of the Financial Technology Office of the Institute of Finance of the Chinese Academy of Social Sciences, told reporters: “The student is an agreement signed with the lending institution. No matter who goes bankrupt, the student is still the lender. From a legal point of view, the student does have the obligation to repay. The student needs to follow up first. The bank or financial institution resolves the repayment problem, and then sue the bankruptcy institution."
Zhao Zhanzhu, a special researcher of the Intellectual Property Research Center of China University of Political Science and Law, also pointed out that because it is a one-time loan, according to the consumer's application, the consumer financial institution pays the money to the merchant, and the student needs to repay the loan in installments.
From a legal point of view, students should continue to repay.
If the student does not repay, the financial institution will also sue, and the student’s credit will also be damaged.
On the one hand, the tuition fee was in the water, and on the other hand, the loan was still being repaid. The interviewed students all said that they "cannot afford to hurt, and are about to collapse."
Some students asked whether the training institution could refund to themselves those class fees that have not yet been in class?
Tian Yanli observed that many people in the rights protection group just paid tuition fees not long ago, and the amount is not low. “Where did all the money go? Can you refund the money to the students?”
"Wall Street English is obliged to repay consumers' unconsumed payments." Zhao Zhanzhan said that if students want to recover their losses, they can sue the company through legal channels, but ultimately it depends on how many assets the company has on its books.
If the company has no assets or owes a lot of foreign debts, it will be difficult for the trainees to recover their losses.
There are also some students who may have carried out property preservation earlier and recovered part of their losses, but this is a minority.
According to Article 113 of the Enterprise Bankruptcy Law of our country, the bankruptcy property shall be paid off in the following order after the priority payment of bankruptcy expenses and common debts: wages and medical care, disability subsidies and pension expenses owed by the bankrupt to employees, The basic endowment insurance and basic medical insurance expenses that should be credited to the employee’s personal account, as well as the compensation that should be paid to the employee according to laws and administrative regulations; the bankrupt’s owed social insurance expenses and taxes owed by the bankrupt in addition to the provisions of the preceding paragraph Money; ordinary bankruptcy claims.
If the bankruptcy property is not enough to satisfy the repayment requirements in the same order, it shall be distributed in proportion.
"The tuition fees of the trainees belong to the ordinary bankruptcy claims in this clause and do not have priority. After the first two debts have been paid off, if the company still has remaining assets, it can be distributed in proportion to the various claims. Therefore, the company's assets are insolvent. Under the circumstances, the possibility of the students realizing the creditor's rights in full is low." said Wang Xiaoguang, a lawyer at the Kyoto Law Firm.
Wang Xiaoguang told reporters that due to the large number of creditors of Wall Street English operators, the company has a clear intention to apply for bankruptcy, and the company’s debts are likely to need to be resolved through bankruptcy.
However, according to my country’s Enterprise Bankruptcy Law, after the People’s Court accepts an application for bankruptcy, the individual repayment of the debtor by the creditor is invalid.
Under the current situation, it is unlikely that the trainees will achieve refunds through private negotiation with the operators.
“It needs to be explained that the students’ creditor’s rights information in the form of'questionnaire survey' in the WeChat group of human rights protection is the personal behavior of the information collector. Declaration of creditor's rights and other ways of safeguarding rights." Wang Xiaoguang said.
Keep up with the situation and strengthen risk control
Avoid scene financial risks
In fact, the financial risks of the scene caused by thunderstorms in education and training institutions have been learned.
In 2019, Weber English, a 21-year-old veteran English training institution, was involved in a "runaway" storm. Many financial institutions such as China Merchants Union Consumer Finance, Duxiaoman Finance, JD Digital, and China Guangfa Bank were involved.
Among them, large-scale cooperative institutions such as Duxiaoman Finance and JD Digital are the first to bear the brunt.
At present, some small loan companies and consumer finance companies are mainly implementing educational installment products.
Judging from the complaints of students exposed on the online platform, many consumer loans applied for by adult training institutions such as Wall Street English are mostly training and education loan products under the consumer finance companies that cooperate with training institutions on consumption scenarios.
Regarding the cooperation relationship, Du Xiaoman Financial told the relevant media that Wall Street English and its cooperation had been terminated in the first half of this year, and Du Xiaoman said that it is “being concerned” about the loan issue of the students.
"If the lending institution has certain negligence or inaction in the risk control, or there are certain loopholes in the risk control, the lending institution should also bear certain responsibilities, such as reducing or exempting part of the tuition fee, loan amount or interest." Yin Zhentao said.
Yin Zhentao believes that the enterprise does not need to bear any responsibility if it goes bankrupt.
For bankrupt companies, legal regulations and constraints still exist.
For example, does a bankrupt company know that it may go bankrupt in the course of its operations, still collect wealth to swindle money, or engage in other illegal activities?
If there is such a behavior, the enterprise shall be jointly and severally liable.
After bankruptcy, companies will still be subject to some constraints.
Some people in the industry have also pointed out that scenario finance has not changed financial logic and legal relationships. Some financial institutions’ “stepping on thunder” scenario financial incidents are not the fault of scenario finance. The root cause is that risk control is out of control. Rely on the scene platform, and even condone the moral hazard of the scene platform to a certain extent.
“Education scenarios are actually relatively high-quality scenarios. From the user’s perspective, the risk indicators are very good. However, there are some uncontrollable third-party risks, because the cooperative organization may induce users to conduct irregular marketing, and the biggest risk is the cooperative organization 'Run off'." An insider of a licensed consumer financial institution told reporters.
In Yin Zhentao's view, financial institutions used to pay more attention to the ability of repayers, but now agencies have appeared.
Agency is more like a platform, acting as the role of diversion cooperation, this is a new model.
"In the past, banks and cooperative institutions used some traditional methods to carry out risk control, such as whitelisting mechanism, last elimination, etc. Under this new model, traditional methods for risk control are no longer applicable, and adjustments must be made as soon as possible. And change."
Yin Zhentao believes that the reason why the Wall Street English thunder has caused education loan disputes is because of the lack of new risk control methods under the new business model of the platform economy.
"Especially in the business model where the diversion platform and the mutual assistance platform take on more responsibilities, financial institutions and diversion platforms are actually B-end (representing business users and merchants), and we usually think that the C-end (representing consumers) is a disadvantaged group. Therefore, the two B-sides should bear more responsibilities. Consumers should also specify the B-side responsibilities in the contract when signing the agreement. This requires the relevant regulatory authorities to have better and binding contract specifications." Yin Zhentao said , Both consumer finance companies and banks should take more responsibilities in reviewing cooperative institutions.
(Wang Hua and Liu Lin are pseudonyms in the text)