Update: GSX Techedu Inc. – Grizzly Research Presents Smoking Gun Evidence of Fraud

*GSX UPDATE – 6-2-2020 – Read Here

 

 

  • The company gave multiple conflicting responses to allegations leveled by us, and later by other short sellers. In the meantime, we procured what we deem further definitive evidence that demonstrates GSX’s false and misleading statements.
  • We have continued our research and analysis, and have discovered what we believe is comprehensive first-hand data that originates from GSX themselves that shows the real enrollment count of students, as opposed to calculations that derive this number. In our opinion, this amounts to definitive proof of GSX’s fraud, and shows that GSX publicly claimed student enrollment count and revenue are inflated by approximately 900%.
  • Our report contains technical instructions and a video guide showing how anyone can replicate our findings. We urge investors and regulators to look into this matter in immediately because GSX will likely try to cover up its tracks now that we have exposed the methodology of its fraud.
  • We have also reviewed detailed evidence that confirms that GSX appears to be conducting illegal marketing activities on a massive scale. We believe the company’s core marketing strategy is built around identity theft.
  • We obtained records from a third party vendor in China that alleges that it was paid by GSX to supply GSX with fake WeChat IDs and national IDs. We confirmed the authenticity of these documents, including wire transfers between GSX and the vendor.
  • Our analysis of this data suggests that GSX bought over 200,000 fake WeChat Accounts. We sampled 3,000 accounts, most of which we could identify as GSX teachers/tutors. These practices are illegal, we expect Chinese regulators to step in soon.
  • We cover numerous other wrongdoings in this report. We believe that GSX will not be able to credibly defend itself against the numerous allegations that we now confirmed with definitive proof. Other short sellers have started to wise up on GSX’s fraudulent behavior, and we believe the market and regulators are soon to follow.

 

*GSX UPDATE – 6-2-2020 – Read Here

 

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Grizzly Research LLC is focused on producing differentiated research insights on publicly traded companies through in-depth due diligence.