WASHINGTON: The US Department of Justice has charged an Axact executive, Umair Hamid, with collecting about $140 million through a ‘fake-diploma mill’ scheme.

Mr Hamid, a 30-year-old Karachi resident, is charged with one count of conspiracy to commit wire fraud and two counts of wire fraud — each of which carries a maximum prison sentence of 20 years; and one count of aggravated identity theft, which carries a mandatory minimum imprisonment of two years.

A statement released by the US Justice Department identified Mr Hamid as an associate vice president of Axact. US federal agents arrested Mr Hamid on Monday in Kentucky where he had travelled to open a bank account. On Tuesday, he was produced before a US federal court in Fort Mitchell, Kentucky.

Axact describes itself as a software company but is accused of running numerous websites selling fake academic degrees. In May 2015, the Federal Investigation Agency launched a criminal investigation into Axact’s business dealings and arrested its founder Shoaib Ahmed Shaikh and other officials. The arrests triggered a global crackdown on the company. Mr Shaikh was later acquitted in a number of cases and released on bail in one case.

Manhattan US Attorney Preet Bharara, who pursed a criminal case against Indian diplomat Devyani Khobragade, is representing the justice department in this case.

The criminal complaint, filed jointly by the Federal Bureau of Investigation and the US Postal Service, charged Mr Hamid, also known as Shah Khan or Shah, with collecting $140m from tens of thousands of consumers through “a worldwide diploma mill scheme”.

The justice department said that Mr Hamid and his co-conspirators made false and fraudulent representations to consumers on websites and over the phone to trick them into enrolling in purported colleges and high schools, and issued fake diplomas upon receipt of upfront fees from them.

“As alleged, while promising the rewards of a higher education, Umair Hamid was actually just peddling diplomas and certifications from fake schools,” Mr Bharara said. “Hamid allegedly took hefty upfront fees from young men and women seeking an education, leaving them with little more than useless pieces of paper.”

US Postal Inspection Service’s Inspector-in-Charge Philip R. Bartlett said: “Mr Hamid took advantage of the aspirations and dreams of thousands wanting a college education by devising a scheme to issue college coursework, degrees and certifications not worth the paper they were printed on.”

He said that postal inspectors and their law enforcement partners would spare no resource to bring these scammers to justice, protecting those striving for higher education.

FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “Thousands of people’s hopes were crushed as this alleged diploma mill scheme came crashing down. Victims took at face value the lies Hamid and his co-conspirators are alleged to have sold them. Today, we’re rewriting the lesson plan.”

The federal complaint against the accused said, “Mr Hamid and his accomplices operated a massive education diploma mill through the Pakistani company Axact, which has held itself out as one of the world’s leading information technology providers”.

Axact promoted and claimed to have an affiliation with approximately 350 fictitious high schools and universities, which Axact advertised online to consumers as genuine schools. During certain time periods since 2014, Axact received approximately 5,000 phone calls per day from individuals seeking to purchase Axact products or enrol in educational institutions supposedly affiliated with Axact.

When consumers asked where the schools were located, sales representatives were instructed to give fictitious addresses.

Once a consumer paid for a school certificate or diploma that falsely reflected a completed course of study, Axact sales agents were trained to use sales techniques to convince the consumer that the consumer should also purchase additional “accreditation” or “certifications” for such certificates or diplomas to make them appear more legitimate.

Mr Hamid served as Axact’s assistant vice president of international relations. While based in Pakistan, he was involved in managing and operating online companies that falsely held themselves out to consumers over the Internet as educational institutions.

Published in Dawn, December 23rd, 2016

Opinion

Police & prosecution
16 Jan 2021

Police & prosecution

Yasin Malik’s case is a revealing example of Modi’s political vendetta.
Changes in privacy policy
16 Jan 2021

Changes in privacy policy

It is indeed a blunder by WhatsApp to move towards a model that is less private than before.
A national dialogue?
15 Jan 2021

A national dialogue?

Fundamental reforms are needed to change the ‘system of spoils’, not save it.

Editorial

16 Jan 2021

Gas liberalisation

AFTER drawing much criticism from both consumers and the opposition over its mismanagement of the energy sector that...
16 Jan 2021

Osama Satti inquiry

THE findings of the judicial inquiry into the Jan 2 killing of 21-year-old Osama Satti in Islamabad merely confirms...
Updated 16 Jan 2021

British MP on IHK

DESPITE sustained efforts by New Delhi’s rulers to remove India-held Kashmir from the global discourse, people of...
Updated 15 Jan 2021

Trump’s impeachment

The impeachment move may well remain symbolic in nature; even then, the symbolism itself is a potent one.
15 Jan 2021

Economic growth

MOODY’S Investors Service expects Pakistan’s economy to grow by a modest 1.5pc in FY2021, much higher than the...
15 Jan 2021

Madressah students

GETTING students of madressahs involved in politics is a bad idea, primarily because seminarians should be...