"It is of course extremely serious. It perhaps suggests that legislation in the future needs to be clearer," Ingegärd Hilborn, the Swedish Schools Inspectorate (Skolinspektionen) general counsel, told TV4.
Despite the man having a prior conviction for having sex with a seven-year-old girl, he received permission to open three independent high schools in Stockholm in 2000, according to TV4.
Furthermore we was subsequently sentenced in 2007 to six years in prison for several more sexual crimes, including the aggravated rape of a child.
The Swedish government now wants to change the law so that the Schools Inspectorate can verify whether a person has previously committed a crime.
The agency's lead counsel told Swedish television channel TV4 on Monday that it does not check up on whether a person has committed a crime when he or she applies to start a school.
When the man began his prison sentence and could no longer manage the schools, he placed them in the care of two individuals, one of who is a woman who had a prior conviction, and had served two years in prison, for pimping.
The firm remains in charge of the operation of three schools in the Stockholm area.
The Schools Inspectorate looks primarily at the principal's financial suitability to start a school. It was not aware at the time that the three high schools were run by convicted criminals.
"There should be a law that ensures that those who are convicted of these kinds of crimes do not receive permission," director-general Ann-Marie Begler said on Monday.
The agency currently does not have access to information in the crime registry and to ring around to all of Sweden's courts to request verdicts is not practical, Begler argued.
"Then we would have several years of processing time. We need a better system that puts a stop to these kinds of possibilities," she said.
Education Minister Jan Björklund agreed and announced plans to immediately move to change the law.
"It is shocking and I am upset at the naïveté that we have in Sweden about this. When the agency receives an application, it should be able to ask for information from the crime registry. If one has a license and is sentenced, the court should notify the authorities," he said.
A new law could come into effect within a year, Björklund forecast.
"Already when the [current] law was established, we should have thought about this. However, we could not have imagined then that this could happen," he said.