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Federal Investigation Agency raided the office of Axact in Karachi. — PPI
Federal Investigation Agency raided the office of Axact in Karachi. — PPI
FIA officials seen during a raid on office of Axact. — Online
FIA officials seen during a raid on office of Axact. — Online
NYT report also referred to concerned Senate house committee for investigation into Axact's operations. — PPI
NYT report also referred to concerned Senate house committee for investigation into Axact's operations. — PPI
Deputy Director FIA Corporate Crime Circle Kamran Attaullah coming with his team to raid the office of Axact. —
Online
Deputy Director FIA Corporate Crime Circle Kamran Attaullah coming with his team to raid the office of Axact. — Online
A view of the computers confiscated by the FIA team from Axact's Islamabad Office on Tuesday. — DawnNews screengrab
A view of the computers confiscated by the FIA team from Axact's Islamabad Office on Tuesday. — DawnNews screengrab
A view of people standing at the entrance of Axact's Islamabad office during the FIA's probe into allegations levelled against the IT company. — DawnNews screengrab
A view of people standing at the entrance of Axact's Islamabad office during the FIA's probe into allegations levelled against the IT company. — DawnNews screengrab

ISLAMABAD: A team of the Federal Investigation Agency's cyber crime unit entered local IT company Axact's Islamabad and Karachi offices on Tuesday and collected manuals, records and computers as evidence in the ongoing investigation of a global fake degrees scam.

TV reports quoted FIA Deputy Director Tahir Tanveer as saying that the Axact offices in twin cities of Islamabad and Rawalpindi have been sealed and that around 22 employees of the IT company were taken into custody by the Islamabad investigating team.

Kamran Ataullah, a deputy director at the Federal Investigation Agency in Karachi, said the investigation would not be limited to the contents of the Times article.

“We’ve issued a letter to them, and we’re looking for details of their database, employees, what websites and equipment they’re using,” he said while talking to NYT.

Meanwhile, a team of the FIA's corporate crime unit also visited Axact’s Karachi offices and questioned their employees, DawnNews quoted FIA sources as saying.

No one has been arrested or taken into custody at the Karachi office as yet, they added. Employees, particularly IT employees, were not allowed to leave the office premises during the investigations.

FIA officers swooped on the Karachi headquarters of the company, seizing equipment and records and expelling employees from the building, a member of the raiding party told on the condition of anonymity.

State Department reacts to Axact fiasco

US State Department, while reacting to allegations levelled against Axact in a New York Times article, said it had made no agreement on document attestation with the said company, DawnNews reported.

The state department said it keeps providing relevant information on its website to protect citizens from scams.

It further added that investigations on the company’s practices are currently underway in Pakistan.

Earlier, action against Axact kicked off after Federal Interior Minister Chaudhry Nisar Ali Khan ordered an inquiry into a story published by The New York Times that claimed the company was issuing fake degrees as part of a massive, global scam.

An interior ministry spokesman said Nisar had directed the FIA to submit a report after a thorough investigation.

The minister in his directive also said that the FIA was to determine whether the contents of the NYT story were true and whether the company was involved in any illegal business which may bring a "bad name" to Pakistan.

FIA corporate crime circle has issued notice to summon Axact’s chief Shoaib Ahmed Shaikh on Thursday, DawnNews reported.

The officials have also asked the company authorities to present their registration certificate, tax return details and the details of degrees issued so far, it added.

The detailed NYT report titled "Fake Diplomas, Real Cash: Pakistani Company Axact Reaps Millions" and written by New York Times Pakistan bureau chief Declan Walsh outlined how Axact — referred to as a "secretive Pakistani software company" — allegedly earned millions of dollars from scams involving fake degrees, non-existent online universities and manipulation of customers.

According to the report, Axact created a series of fake websites involving “professors” and students who it said were in fact paid actors.

An FIA official who did not wish to be named said that the allegations raised by the newspaper if proven true would be punishable by seven years in prison under Pakistan's Electronic Transaction Ordinance.

Senate takes notice

The NYT report was also referred to the concerned house committee of the Senate by Chairman Senate Raza Rabbani for investigation.

"A story has been published in the newspapers attributed to Pakistan, and Shoaib Ahmad Shaikh of BOL network has every right to clarify," opposition leader in Senate, Aitzaz Ahsan, said.

Aitzaz added that this was a serious matter because a Pakistani company had allegedly been issuing fake degrees, according to newspaper reports.

"What's the reason that we Pakistanis are such experts in forgery? The matter has to go to the house committee," Aitzaz said.

The Senate chairman, after hearing the matter, observed that the issue raised was of importance. He referred the matter to the concerned house committee and ordered an investigation.

Axact's response

In the statement on its website, Axact did not directly respond to the allegations but instead accused domestic media rivals of colluding with the New York Times to plant a slanderous story in order to harm its business interests.

The response also alleged that Declan Walsh had devised a "one-sided story" without taking any input from the company.

Axact uploaded a detailed legal notice sent to NYT. The company also sent a legal notice to local blogging website Pak Tea House, which caused a buzz on social media. NYT also ran a short report on the Pak Tea House legal notice titled, "Axact, Fake Diploma Company, Threatens Pakistani Bloggers Who Laugh at Its Expense".

Axact and its CEO, Shoaib Ahmad Shaikh, did not respond to requests from Dawn.com for comment


Comments (92) Closed



M.M.Sherazi May 19, 2015 12:29pm

It is very upsetting development, the truth has to be extracted whoever stands out guilty must be punished to the extreme levels to stop such mal-practices on both sides, i.e. Axact or Media House..

Haider Rehman May 19, 2015 12:29pm

The response of axact is not good enough.

Junaid May 19, 2015 01:16pm

If Axact has any evidences, then they should show on media as well as on international media...!

DamaDum-MastKalandar May 19, 2015 01:17pm

NYT has a history of defaming Pakistan, nothing new here.

Nasir May 19, 2015 01:17pm

All fake degree issuers should be stopped immediately. Many genuine students aspiring for better quality foreign certified education fell prey to these opportunists.

David May 19, 2015 01:22pm

The dangerous part is that these guys have been using US Secretary of State John Kerry's signature to legitimize their business as mentioned in the NYT article. I don't know if that is a fake or if it is real (obtained under false pretenses). It might cause the US government to take action for utilizing a senior government official's signature for nefarious purposes.

irfan farooqui May 19, 2015 01:27pm

so embarassing situation for Pakistan globally because of this company....please Aaxact management prove yourself if you guys havent done anything wrong.........

adnan May 19, 2015 01:53pm

just defemaing pakistan this delcan chap is an operator for this purpose

Iqbal Malik May 19, 2015 02:01pm

All Axact responsible officials living in Pakistan should be barred to leave Pakistan till the completion of government investigations.

excalibur May 19, 2015 02:13pm

media rivals out to demonize a new competitor

Declan Walsh ' s credentials dubious with a dark history

Why is there no codemnation of people fishing for fake degrees

Zahid Khan May 19, 2015 02:25pm

Axact must be bold enough to tackle this, or it will be a shame for Pakistan !!

Anwar May 19, 2015 02:32pm

A thorough and transparent investigation need to be conducted and it's not necessary that NYT is correct in it's allegation because story and drama creators are very famous in the world.

If Axact is not guilty then the government should take up the matter very seriously on behalf of Axact to support and safeguard our IT companies. Don't forget that envies are always out there.

khanman May 19, 2015 02:55pm

solution is simple, those who earned fake degree( as they say) should come forward with the degree, the univ name written on it should reveal if it exists or not simple.milks milk water water :)

last comment May 19, 2015 02:58pm

can't believe than journalists like Kamran Khan and Waseem Badami joined BOL channel without any due diligence.

Kamil May 19, 2015 02:59pm

Sorry but we also need an honest officer on this enquiry otherwise truth will never come out. FIA don't forget the otherside and do your job honestly .

Sense May 19, 2015 03:03pm

So this company is a fraud,that has nothing to do with the rest of Pakistan .Take it easy

NS May 19, 2015 03:29pm

its a test of FIA, if they find evidence good, if not it means there is some serious flaws in their investigations and we can never trust them with anything..I dont think there is anyone in Karachi who doesnt know about dubious activities of Axact..

Azmeen May 19, 2015 03:35pm

Where was the FIA before this? This is the case of national defamation. In case the A is proved to be guilty, justice should be served a/c to the Law of the Land.

Harmony-1 May 19, 2015 03:36pm

Crime doesn't pay, it catches up with you eventually. If found guilty, should be punished severely.

Viking Star May 19, 2015 03:37pm

It is pity that our authorities keep sleeping and suddenly wake up from sleep when someone else breaks a news. FIA must act sober and not harass people not linked to scam. I was watching tv and it shows many people are being arrested (must include employees on payroll) and they are also trying to locate people who built Axact websites. This is ridiculous. Only the owners and executives who were running the alleged ill business should be taken to task and an inquiry done. FIA should NOT harass employees and any other person - not related to scam.

Factual May 19, 2015 03:42pm

I am happy to see FIA taking charge and willing to investigate matters which are of concern to nation. More responsibility taken by CIVIL law enforcement agencies is a good news for society and democracy. That's more like it, I say! Keep going and be fair but assertive. We support you!

Walee May 19, 2015 04:13pm
  1. The twin city offices were sealed with 22 employees. Given the size, these are most likely front offices which makes the likelihood of finding something here less likely.

  2. Why were the Karachi offices not sealed? The bulk of the work happens there and the technical staff all sits there.

  3. Why does the FIA even need to seal the offices? They should get a secret warrant and tap the lines to determine if international calls are terminating locally. Or if indeed the HTTP traffic is pointing to the 50+ suspected websites. This will give a very clear indication.

There are so many unanswered questions still, it would be prudent of the FIA to compile a detailed response. What do those hundreds of employees come in to work to do every day? Why do so many of them claim unethical work practices? How come Axact can't name any clients for it's software services? How come no one in Pakistan has used their services after all these years?

ayazali May 19, 2015 04:14pm

we need to take every step to save the pakistan's image, which is already in trouble

Quazimodo May 19, 2015 04:14pm

"In the statement on its website, Axact did not directly respond to the allegations but instead accused domestic media rivals ......"

Axact did respond to the allegations, denied them and called them baseless. their exact statement from their website " Axact condemns this story as baseless, substandard, maligning, defamatory, and based on false accusations ...."

If the company is involved in fake degrees, they should be fully persecuted . But if the NYT info is found baseless, it is they that should be persecuted.

Strict statements should be handed to the one harming Pakistan's reputation.

Fahad Mirza May 19, 2015 04:17pm

@Anwar

IT Company?? what innovations in IT they are doing. this IT sectory is also limited now, for your kind information.. stay in real world. whats there nature of business and source of revenues ?

Adnan May 19, 2015 04:18pm

I wonder how can you just "arrest" the employees? Nothing is proven yet. This culture must change.

Syed Abbas May 19, 2015 04:22pm

Do we have well-educated team in FIA to investigate cyber crimes? And do you think that Axact is fool enough to do crime under their roof.

London Man May 19, 2015 04:28pm

Its a shame yet painful to see an aspiring (so called) IT company messed up so badly!! Hope this is not true but looks like it is

Jawad May 19, 2015 04:29pm

Shuting down some company based upon an article in NYT is scarry ? May be the company is fraud / may be not. But need to prove it first and then shut down.

ali May 19, 2015 04:31pm

The question is if this organization is issuing these fake degrees, why don't the Govt. put them behind bars. All parties are innocent until proven guilty. I smell a rotten egg in this report. The facts does not add up. Be brave Axact and tell the real story.........

Moin May 19, 2015 04:32pm

@Adnan i do second you

SR May 19, 2015 04:37pm

Why arrest staff? What about CEO? is he not responsible for all this?

Blue Saffron May 19, 2015 04:41pm

It takes NYT to expose potential crimes in Pakistan. What are Pakistan's investigators doing?

Bilal May 19, 2015 04:45pm

@Adnan , they are arrested for investigation and not to prison. They will be released.

M. Siddique May 19, 2015 05:12pm

@Junaid, Why should they show it to media. They should produce in court. Moreover, our media depends on rumours and is incompetent to make an objective analysis.

Ali Imran May 19, 2015 05:16pm

Innocent until proven Guilty

Checko Pune May 19, 2015 05:18pm

@Quazimodo By responding they meant talk about degrees that they give out.

Dr AH / Germany May 19, 2015 05:23pm

Mr. Aitzaz Ahsan, I ask myself this question: What is the reason that Asif ali Zardari is an expert in corruption and gets scot free in Pakistan. Maybe, in the answer to this question we can get some clue to your question, Mr. Aitzaz Ahsan.

Faisal May 19, 2015 05:47pm

Big fish caught...lots of money to be made here even if Axact is innocent or not...

Habib May 19, 2015 05:54pm

Well Done FIA, they must be taken to task, what is their actual business? no one knows. They do not have any software house, and in spite of no prominent IT business, they are earning millions, how?

ghazanfar May 19, 2015 05:59pm

Having said all, this is also important not to be swept away by NY Times report and justice should be done thoroughly. Of late, these international news agencies have published a number of fake reports that destroyed many businesses and countries. Iraq chemical weapons is the worst example of recent times. However, if found guilty, an exemplary punishment should be meted out to this company for bringing bad name to the entire nation.

Ridah May 19, 2015 05:59pm

I have learned that many US federal officials hold certifications from Axact run fake universities. Now, this is big!

wasim kamran May 19, 2015 06:02pm

Yesterday I heard about agency . NYT reveal a Pandora box regarding " axact", this is very serious concern. interior ministry should take stringent action through the concern authority.

Enlighten me May 19, 2015 06:05pm

Sad day for journalism in this country if this report turns out to be correct.

Mehmood May 19, 2015 06:17pm

Everyone in the IT industry knows that Axact has been doing dodgy stuff for a long time. It is not only fake degrees but also running obscene websites too!

Riyadh May 19, 2015 06:34pm

Don't believe the NYT story, it looks like a plot to destabilize Pakistan, don't forget the recent Safoora attack and the agency behind it, the same agency could be behind this fake story to defame Bol.

Ahmad May 19, 2015 06:39pm

Appropriate action by authorities. However the actions of a private company are being highlighted as " Pakistani state owned company" to malign Pakistan as if no American or other privately owned financial institution has ever been involved in such activities. We have a recent example of " financial crisis in our very ownUS where almost every financial institute was directly or indirectly involved". Bad people and companies are every where please don't make them country specific

Ahmad May 19, 2015 06:40pm

@irfan farooqui it's private company. Pakistan has started investigations.

NHM May 19, 2015 06:42pm

Wonder why these fraudsters escaped the ire of "sar e Aams" and "Iqrar ul hasans"

proud-winner May 19, 2015 06:53pm

Well done FIA.

Abdul May 19, 2015 07:13pm

Even though it seems like a crime but it has been dealt again wrongly by govt. Just based on an article FIA can't raid someone's offices. They should be given a chance to explain. Also in order to avoid shame to country, authorities should have downplayed it and must have allowed few days for issue to ease down.

Muhammad Ali Khan May 19, 2015 07:15pm

I reckon FIA should work in collaboration with a professional audit firm specialized in "Forensic investigation and IT audits ... FIA alone can't unearth all the loop holes, let some professionals investigate into this specialized + complicated fraud scheme...

Axact's been in the market for years and almost everybody knew how they make millions except the concerned authorities ...

P.S. Axact's financial auditors must be questioned for their professional misconduct or negligence for so many years ! everyone involved in this scam in whatever role and extent must face the music now !

Malik May 19, 2015 07:21pm

@DamaDum-MastKalandar And why would they do that sir?

Malik May 19, 2015 07:24pm

@Enlighten me How is it a sad day for journalism its the IT industry thats at stake here

Mr. Kool May 19, 2015 07:49pm

@Anwar Axact if found correct , NYT will have to pay heavy fine in American court and all losses to Axact . NYT know it . So without proof NYT is not moving.

Khan May 19, 2015 07:54pm

Everything was happening and Interior ministry and FIA were sleeping and now when the stories are out all over the world, our machinery is now active. Why our machinery is so slow and their approach is only reactive and not proactive ?

Anwar May 19, 2015 07:56pm

And sad news is that FIA had not prior information about such scam.

Riaz M M May 19, 2015 08:25pm

Ax act may or may not be guilty but what mysterious reasons lie behind immediate action by the govt and the senate.our govt and parliament are not in the habit of acting promptly even in the matters threatening the security and peace of our motherland.As regards Aitazaz Ahsan pontificating on this matter,he has every right to express his feelings about this matter but his comments will carry more weight if he leaves the PPP as he remains a member of PPP which is most notorious party for corruption and inefficiency .

zafar May 19, 2015 08:39pm

No one in their right mind would start an investigation at this level on a story appearing in foreign newspaper, specially NYT. The right thing to do would be to investigate but not disrupt the business of Axact unless proven otherwise. We Pakistanis as usual have displayed our strange sense of justice by turning on its head the maxim 'innocent until proven guilty'.

Azi May 19, 2015 08:45pm

@irfan farooqui

Stop getting embarrassed over everything possible, its exactly what your foes want you to feel. Company doesn't represent Pakistan as a whole. I can point a number of things to you for Indians in similar situations. If you get embarrassed by this much, they would want to commit suicide over what I can share using same logic. Please learn to have some dignity and self respect.

You should feel good instead that these culprits are apprehended asap. NO nation, society, continent in the world is corruption free. Stop being so naive.

nwa May 19, 2015 08:57pm

Where are the fake degree holders, they should be brought in to picture and then every thing will follow.

Anwar May 19, 2015 09:31pm

@FAHAD MIRZA very true

Ayaz Khan May 19, 2015 09:55pm

Declan Walsh is no ordinary journalist. A friend journalist of mine knows him personally and praises him for his honesty. He will never write something based on speculations, in fact if this latest article is read carefully he cites proofs from three different continents. Besides, NYT has an entire legal department that will think and verify several times before publishing such a piece. Axact has been rightly exposed. They know about Declan very well and yet they repeatedly referred to him as ‘some’ journalist in their response to these allegations as if he was an ordinary low-paid guy seeking a breakthrough in his journalism career at the cost of his credibility. It hurts how we were promissed so much in the name of Bol and what it really turns out to be.

CYRUS May 19, 2015 09:58pm

@excalibur

The New York Times is trusted worldwide.

Arshad Mahmood May 19, 2015 10:22pm

This is very delicate matter. We should not take action on media reports. It should not be a media on basis of foreign newspapers. It should be dealt with careful investigation . Unfortunately FIA cyber wing staff in Pakistan is illiterate and they have no idea about cyber crime and how IT works.

afia salam May 19, 2015 10:56pm
            2 questions: 

Under which law were the staff arrested and what is the due process? what evidence resulted in this?

Aamir May 19, 2015 11:21pm

Fake degree is a global issue but only Pakistan is defamed. Axact may be involved but not to that extent that its business should be sealed.

D_Hussain May 19, 2015 11:35pm

There is probably more to this than meets the eye. The way FIA has acted, or rather reacted after a mere article published by a foreign news agency was disgusting.

There has to be a proper legal procedure that needs to be carried out before hard-working employees of a company are interrogated at their workplace!

Its ironic, considering that majority of the powers that be, steal money from Pakistan and send it abroad, while in this case, the allegation is that axact was stealing money from the west and bringing it to Pakistan. Perhaps the ruling elite realized that its about time to steal again.

asad May 20, 2015 01:45am

@ayazali what image?? please describe

aslam shaikh May 20, 2015 02:03am

Nothing will happen. They are going to pay Millions of dollars to pay their way out.

Sab Se Pehle Pakistan May 20, 2015 02:28am

If found guilty both axact and bol should be banned for good. They have dented Pakistan's reputation around the world.

mike USA May 20, 2015 03:39am

'Under investigation' normal in US. Not guilty unless proven otherwise.

Moiz B May 20, 2015 03:50am

It will be interesting to find out how many Pakistani politicians are involved

syed May 20, 2015 04:16am

use the same zeal with corrupt politicians.

syed May 20, 2015 04:17am

@DamaDum-MastKalandar - because its always the truth ?

syed May 20, 2015 04:17am

@irfan farooqui - we are used to embarrasment now.

syed May 20, 2015 04:18am

@Anwar - head in the sand.

Shujaat Khan May 20, 2015 04:19am

@nwa They are sitting in Parliament House.

syed May 20, 2015 04:19am

@ayazali - too late to save pak image. sorry.

Masood Haider May 20, 2015 04:39am

Riyadh! Get real. How can you believe such stupid conspiracy theories?

Third Party May 20, 2015 04:58am

We are not surprised !!! What could be expected ??

Asif May 20, 2015 06:20am

my very close friend works in axact for many years and he told me and all the other friends in my circle that axact does every single thing that is been accused for in new york times. every thing is true mentioned in new york times

Asif May 20, 2015 06:21am

everything newyork times accused axact is true and I can say from personal credible sources

mukhtar May 20, 2015 06:22am

The fact remains Pakistan's image has been tarnished. Question arises how any company can pay its employees salary running in crores without having launched its TV channel. Secondly there has to be rationale when you fix salaries

No such example can be quoted from the world where media house yet to come in the market can afford this luxury. Credibility damaged beyond repair

AliPasha(USA) May 20, 2015 06:41am

MNA Dasti had a fake degree and inspite of that he won the election.Education and educated people have no value or place in Pakistan.

Asma Sheikh May 20, 2015 06:51am

Looking at the comments, I feel we Pakistanis are living is a constant state of denial. Rather than criticizing the forgers we are accusing the NYT of defaming Pakistan. Yes NYT is often critical of Asians, south Asians in particular, like they mocked India's space programme. But I see no bad intention on part of NYT here. Axact is in all probability a big fraud, but so many of us are simply not ready to accept it.

In other walks of life too, we are in state of denial. Talking about security situation, rather than questioning our own institutions for their wrong policies and their failure, we are blaming external forces for the deteriorating situation. Such attitude will only exacerbate our current problems. We as a society and nation need a big change.

Col Fareedi May 20, 2015 06:51am

I went on Columbiana university web site and tried to chat. Coincidently all the operators are off line at this time.

Brutally Honest May 20, 2015 07:51am

Lahore and Karachi has history of defaming Pakistan

Ali-Indian May 20, 2015 09:33am

A Nobel way to increase the literacy !!

Kamil May 20, 2015 09:33am

@Riyadh . Don't believe NYT stories but use your brain and intelligence and decide. What was going all around Axcat was too fleshy and one can see money flowing . Spcially if company is paying Rs. 25 .00 only as tax. Let us know what your common sense tells you?

Shah May 20, 2015 10:16am

One must not forget the illegal and secretive activities of NSA and allied agencies of USA. Some thing fishy there in the article of NYT. NYT has a history of defaming Pakistan.

rehan May 20, 2015 10:48am

NYT is hardly a newspaper we should be paying attention to . However , if what NYT has published is true , then Axact should be given exemplary punishment . If the story is false, then NYT should be banned . Media is hardly trustworthy and would publish anything without due research for financial gains.