KARACHI: A judicial magistrate remanded on Wednesday the chief executive officer and four other officials of a software company in the custody of the Federal Investigation Agency till June 4 in a fake degrees and money laundering case.
The FIA arrested Axact CEO Shoaib Ahmed Shaikh and Viqas Atique, Zeeshan Anwar, Mohammad Sabir and Zeeshan Ahmed for allegedly preparing and selling fake degrees, diplomas and accreditation certificates of fictitious schools/universities through a fraudulent online system and illegally minting millions of dollars.
The FIA produced them before the court and investigating officer (IO) Saeed Ahmed Memon sought their custody for two weeks. He submitted that further recovery of incriminating documents was to be made and information about international connections, bank accounts and money laundering transactions was to be discovered on the leads to be provided by the suspects.
The officer said in the remand report that an investigation into cyber crime would be completed with the help of the detained suspects. Original documents, record and computers are yet to be secured.
He claimed that incriminating articles were recovered from the possession of the suspects.
Advocate Naeem Qureshi, who heads a panel of lawyers representing the suspects, argued that the alleged offence had taken place between 2006 and 2015 and there was neither any private complainant nor did any victim appear before the investigating agency.
He said recoveries had already been made and the offices of the company seized while the suspects were arrested after an inquiry. Therefore, the lawyer asked the court to send his clients to prison because physical custody would not serve any fruitful purpose.
The judicial magistrate (south), Noor Mohammad, observed that the case was of a serious nature and since the suspects failed to justify the recoveries, the matter required investigation.
The court handed over the suspects to the FIA on one week’s physical remand for questioning and asked the IO to produce them on June 4, along with progress report and investigation dairies.
When Shoaib Shaikh and Viqas Atique sought medical treatment, the court directed the IO to do so.
According to the FIR, the case was lodged after the outcome of an inquiry. According to it, Shoaib Shaikh initially set up a firm in the name of M/s Axact FZ LLC, UAE, and later incorporated it with the Securities and Exchange Commission of Pakistan as M/s Axact (Pvt) Limited, Pakistan.
It said Shoaib and his wife Ayesha, a director of the firm, had shares of only one per cent each, while Axact FZ LLC, UAE, held 599,998 shares.
The FIA claimed in the FIR that suspects were found involved in issuing and selling forged degrees, diplomas and accreditation certificates of fictitious universities, schools and colleges purportedly based in different countries, including the United States, through fraudulent online education system to foreign students.
It said the suspects received huge amounts of money as fees through online credit/debit cards, deposited them in a bank account of the firm in the UAE and then brought the money to Pakistan as proceeds of software exports.
Fake and blank degrees and certificates and blank and filled accreditation letters, stamps and embossing machines were recovered from the company. FIA’s forensic team examined a few systems installed at the company’s main office in Karachi and initial technical findings explained about customer relations management web applications used by the company for the purpose of selling online fake degrees and certificates, it added.
It said that an FIA team under the supervision of a judicial magistrate had raided the company’s office in DHA on the night between May 26 and 27 and found hundreds of thousands of blank degrees and certificates, adding that details of some degrees fraudulently linked with 44 foreign universities, along with nine accreditation bodies, had so far come on record.
A case was registered against the detained suspects, Axact FZ LLC, UAE, and others under Sections 420 (cheating and dishonestly inducing delivery of property), 468 (forgery for purpose of cheating), 471 (using as genuine a forged document), 472 (making counterfeit seal, etc, with intent to commit forgery punishable under Section 467), 473 (making counterfeit seal, etc, with intent to commit forgery punishable otherwise), 474 (having possession of document described in Section 466 or 467 knowing it to be forged and intending to use it as genuine), 477-A (falsification of accounts), 109 (abetment) and 34 (common intention) of the Pakistan Penal Code, Sections 36 and 37 of the Electronic Transaction Ordinance, 2002, and Sections 3 and 4 of the Anti-Money Laundering Act, 2010, at FIA’s corporate crime circle Karachi.
The interior minister had ordered an inquiry against the company after The New York Times published a report against it for allegedly selling fake diplomas and degrees online through “hundreds of fictitious schools” and making “tens of millions of dollars annually”.
In the wee hours of Wednesday, an FIA team, led by its Sindh director Shahid Hayat Khan who was tasked with the Axact scandal investigation, raided the company’s printing facility adjacent to its headquarters and claimed to have recovered hundreds of thousands of blank fake degrees.
“Actually, Shoaib Ahmed Shaikh guided us to this place,” judicial magistrate Javed Malik told reporters outside the Axact building after the raid.
“During the raid we have recovered hundreds of thousands of blank degrees and students’ cards. They are so much in number that their counting may take time, but we can say that there are hundreds of thousands of degrees we have found here,” he said.
The FIA officials also showed samples of blank degrees and certificates recovered from the Axact facility and said that investigators had so far found such documents associated with 44 universities and high schools.
“Now we have enough evidence to lodge a case against Axact’s men and we are going to do so,” Shahid Hayat Khan said. “We already had some reports and during the course of investigation we came to know about further facts so we approached the court for judicial process and they allowed us to raid the place in the presence of the magistrate,” he said.
DEMONSTRATION: Meanwhile, hundreds of journalists and media workers gathered outside the Karachi Press Club on Wednesday evening to show solidarity with Bol TV which was in a stake of uncertainty because of the charges against Axact chief Shoaib Shaikh for running a fake degrees racket through his IT company.
The demonstration was called by the Karachi Press Club, Karachi Union of Journalists and Pakistan Federal Union of Journalists.
“We are neither against any inquiry nor do we want to influence the legal procedure. We have gathered here to show solidarity with journalists and media workers who have been working in Bol TV,” KPC general secretary A. H. Khanzada said.
“We want this channel to go on air and its future should not be affected by investigation into the fake degrees scandal. We are concerned about the job security for hundreds of members of our community and we stand by them for their rights,” he said.
Published in Dawn, May 28th, 2015