The financial collapse of the American International School Vietnam (AISVN), which raised more than 3,200 billion VND (approx. 126 million USD) from parents, has taken a new turn with the arrest of Nguyen Thi Ut Em, the school board chairwoman.

On May 1, the Ho Chi Minh City Police Department issued a decision to prosecute and temporarily detain Nguyen Thi Ut Em, Chairwoman of the Board of AISVN, on charges of “disturbing public order.”

The Ho Chi Minh City Inspectorate has also transferred the case file to the city’s investigative police, recommending an investigation into potential illegal capital mobilization by the American International Education JSC through investment contracts and loan agreements signed with students’ parents.

Previously, in late 2023 and early 2024, the public was rocked by revelations that parents had lent over 3,200 billion VND to AISVN but were unable to recover their funds.

In recent years, private schools - especially those operating under international education models - have increasingly offered “education investment packages.” These are essentially capital-raising schemes that involve parents.

In the case of AISVN, parents lent the school from 2 to nearly 10 billion VND (approximately 79,000 to 394,000 USD) per student, interest-free, in exchange for a 12-year tuition waiver. If the student graduated, transferred, or dropped out due to health reasons, the school was supposed to return the full loan amount.

Over 90% of parents fully paid for their children to attend AISVN until graduation under these contracts, resulting in a total mobilized sum exceeding 3,200 billion VND. This capital was raised directly under the direction of Chairwoman Nguyen Thi Ut Em.

The crisis erupted in September 2023, when parents began appealing to media and authorities after the school failed to repay the loans. By March 2024, AISVN had suspended all student activities, citing financial distress and unpaid wages and insurance that led to staff strikes.

A tangled web of companies

Born in 1963 in Vinh Long, Nguyen Thi Ut Em is the Chairwoman of the Board of American International Education JSC, which owns AISVN. She also represents a network of similarly named companies primarily focused on the education sector, such as American International Education Investment JSC, American International University Investment JSC, International Education Group JSC, and American International Group JSC.

Most of these businesses are registered at 209/21B Ton That Thuyet Street, Ward 3, District 4, Ho Chi Minh City. American International Group JSC is primarily engaged in preschool education, while American International University Investment JSC lists its main business as renting machinery, equipment, and other tangible goods.

American International Education JSC, headquartered at 220 Nguyen Van Tao Street, Long Thoi Commune, Nha Be District, was established in 2018, with its main business listed as elementary education.

According to the Hanoi Stock Exchange (HNX), the company issued three bond tranches:

AIECH2122001 in October 2021: 12-month term, worth 250 billion VND, with an 11% annual interest rate
AIECH2223001 in January 2022: 18-month term, worth 250 billion VND, interest rate 11.5%
AIECH2224002 in September 2022: 24-month term, worth nearly 318 billion VND, interest rate 10.5%

All three bond tranches are no longer in circulation.

In July 2023, the company requested to delay the maturity date of the AIECH2223001 bond (250 billion VND) from July 26, 2023, to January 26, 2024, while increasing the interest rate to 12%.

For the AIECH2224002 bond, PetroVietnam Securities (PSI) acted as the depository agent. On September 20, 2023, PSI confirmed that American International Education JSC had failed to pay the interest on time and was unable to resolve the default within the required seven working days.

When founded, the company had a charter capital of 50 billion VND (approx. 2 million USD), with Nguyen Thi Ut Em holding 90%, Ho Quang Trung 9.9%, and Ho Quang Tri 0.1%. On October 25, 2018, the charter capital was increased twentyfold to 1,000 billion VND (approx. 39 million USD).

To date, AISVN has yet to present a concrete plan to resume normal operations.

Manh Ha