In this file photo dated Sept 1, 2022, students return to campuses in Tseung Kwan O as new academic year begins. (CALVIN NG / CHINA DAILY)

Hundreds of parents and staff fell victim to the abrupt closure of a Hong Kong private tutoring company Brilliant Education.

As of 6 pm on Monday, Hong Kong Customs received 219 reports, involving HK$1.83 million ($234,620). The Consumer Council also received 63 complaints involving HK$660,000.

Brilliant Education, established in 1996, operated centers in Kornhill, Chai Wan, Shau Kei Wan, Ho Man Tin and Siu Sai Wan, offering programs for kindergartners to senior secondary students.

On Saturday, the company announced the closure of all of its centers, saying it has “fulfilled its historical mission”, without mentioning the reason or offering refunds.

A WhatsApp group set up by affected parents and staff on Saturday night to recover their losses had attracted over 600 members as ofMonday afternoon.

A student’s parent surnamed Chan said on a radio program that she had paid HK$18,000 in advance tuition to one of the centers for her child.

The Consumer Council’s chief complaints and advice officer Dragon Chong Lung-ng said parents who paid by credit card should contact their respective credit card centers as soon as possible to try to get a refund. He reminded consumers that prepayment carries certain risks, and they should minimize the amount of prepayment to reduce potential losses

She said the center had called her repeatedly since mid-July, promising a discount up to 30 percent for an advance payment.

Chan was talked into prepaying for six months of tuition, which was not refunded to her after the center suddenly announced its closure. She said she suspects that Brilliant Education had been experiencing operational difficulties for some time but had concealed this fact from parents while continuing to collect tuition fees.

During the radio program, the Consumer Council’s chief complaints and advice officer Dragon Chong Lung-ng said that if a company is aware that it is likely to be unable to provide services and still collects money from parents, this might be a violation of the Trade Descriptions Ordinance.

The council will try to contact the responsible person at Brilliant Education to refund parents, Chong said.

He said parents who paid by credit card should contact their respective credit card centers as soon as possible to try to get a refund. He reminded consumers that prepayment carries certain risks, and they should minimize the amount of prepayment to reduce potential losses.

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The Education Bureau said the company also violated the Education Ordinance as one of the centers was found unregistered.

Lawmaker Chu Kwok-keung, who represents the city’s education sector, said that according to current regulations, licensed education centers are not allowed to collect more than one month’s tuition fees in advance.

Chu said that previously, the supervision of education centers focused more on student enrollment and whether the advertisements were misleading, with less emphasis on monitoring operational aspects.

He called on related departments to strengthen regulations in this area, including requiring institutions to submit proof of their operating conditions to protect the rights of parents.

Lawmaker Chu Kwok-keung, who represents the city’s education sector, said that according to current regulations, licensed education centers are not allowed to collect more than one month’s tuition fees in advance

Lawmaker Tang Fei, who is also vice-president of the Hong Kong Federation of Education Workers, said that consumption with prepayment had caused lots of controversy, particularly in industries such as beauty centers, slimming centers, and fitness centers.

There is little chance for consumers to recover their prepayments once the service provider ceases trading, Tang said. Although the government has introduced a seven-day cooling-off period arrangement for consumers to cancel the contract, this arrangement applies only to the initial payment and does not cover the recovery of prepaid fees after the business is closed.

He said the government should educate the public on the current legislation, which prohibits tutorial centers from collecting more than one month’s tuition fees at a time.

The Labour Department said it will offer assistance to affected employees, while the Mandatory Provident Fund Schemes Authority said it will file a civil claim on behalf of the affected employees to pursue remaining MPF arrears from the company.

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According to the Non-Compliant Employer and Officer Records of MPFA, Brilliant Education had been pursued for MPF arrears in multiple cases.