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The Leo Chetty Group — the owner of several private higher education institutions such as Damelin, City Varsity and Lyceum College, under the umbrella of Educor — is caught in a bind.
Its education institutions, once revered for igniting minds and shaping aspirations within their campus halls, have been tarnished by recent events, leaving a lingering shadow over their once illustrious legacy. Thousands of students now grapple with uncertainty about their educational future, and the repercussions resonate far beyond corporate interests.
In March, the higher education department revoked the registration of Damelin, City Varsity and Lyceum College after parent company Educor failed to submit financial statements and annual reports for the 2020 and 2021 financial years.
The documents, legally mandated, provide critical insights into an institution’s financial health, staffing levels and long-term objectives. They also shed light on the student numbers and record-keeping practices. By neglecting these obligations, the Leo Chetty Group has fallen short of its responsibility as a private higher education provider.
Policymakers, educators and concerned citizens must hold the Leo Chetty Group accountable for the mismanagement of education
According to regulations, deregistered institutions must promptly notify students within 14 days and provide transcripts of academic records. Crucially, they must also reimburse students for their unfulfilled education.
Additionally, these colleges must make arrangements for affected students to complete their programmes at comparable public or private institutions. The clock is ticking — the deregistered institution must cease operating before or at the end of the academic year.
The result? Students, who once entrusted their future to these institutions, face broken promises, shattered dreams and uncertainty.
Adding to the turmoil, Nedbank has initiated a bid to liquidate the group. The banking group wants to recoup R50m in unpaid loans dating back years. Failure to address these loans could threaten the financial stability of both the group and its associated institutions.
The Leo Chetty Group’s legal defence hinges on the severe impact of the Covid-19 pandemic. Like virtually every sector of the economy, its colleges faced unprecedented challenges. Its students were barred from attending lectures or residing on campuses due to stringent lockdown restrictions. The resulting disruption dealt a severe blow to the group’s financial health, and its effects continued to linger long after the pandemic subsided.
The company contends that Nedbank rushed into liquidation proceedings without considering alternative actions to recover the disputed debt. While the terms of the loans were renegotiated, the group maintains that an oral restructuring agreement was reached with Nedbank.
The liquidation applications remain pending, awaiting a hearing. The Leo Chetty Group seeks access to Nedbank’s internal communication to prove the existence of the oral agreement. But the KwaZulu-Natal high court dismissed this discovery application, emphasising limited relevance and the risk of a fishing expedition.
Beyond the regulatory heat and Nedbank’s bid to recoup R50m, education is more than balance sheets and loan agreements — it is the cornerstone of progress. It is a public good, and a vital asset for our collective future.
Policymakers, educators and concerned citizens must hold the Leo Chetty Group accountable for the mismanagement of education. The impact of the saga is not limited to just the students and staff, but it resonates throughout the entire country.
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