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Two Accounting Scandals in China in One Week Burn Investors

  • TAL Education plunges in late trading over forged contracts
  • Luckin Coffee earlier said officials may have fabricated sales
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April 6: ACGA's Nana Li on China Corporate Governance

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China’s second accounting scandal in less than a week is underscoring concern over lax corporate governance at some of the country’s fastest-growing companies.

TAL Education Group, a tutoring business whose success turned founder Zhang Bangxin into one of China’s richest people, delivered the latest bombshell on Tuesday after saying a routine internal audit found an employee had inflated sales by forging contracts. The company’s American depositary receipts sank as much as 18% in late U.S. trading.