Fake diplomas, real cash: Pakistani company Axact reaps millions

Moeed Pirzada 11 hrs · . Of BOL, Axact, Media Tycoons, New York Times & Govt Interests: - Ch. Nisar spoke well, and carefully articulated his govt's position. Though he requested media not to speculate but his statements gave enough to spill the beans of what is coming, especially with respect to FBI and 'seriously significant evidences'. It appears fate of BOL as a large TV platform and of Axact as an IT Company or whatever it did is more or less sealed. Earlier the tweets of Kamran Khan and Azhar Abbas hint that they, along with many others, were thinking of leaving; this may materialize within the next few hours and it will lead to a panic stampede of all those who will rush to leave looking for jobs. Resultant chaos will lead to major reshuffle within the media platforms consolidating the "media financial interests/owners" and seriously weakening the independent voices within the journalist community and will strengthen the govt that allies with key media interests. There used to be a webportal, "Power & Interest News Report (PINR) in Chicago which I used to subscribe. It was a brilliant online portal with American, Russian and Indian analysts analyzing the clash between different financial and political interests without offering any moral judgments, of good and bad, leaving this to the readers. I think we need PINR Analytical tool to make sense of what happened between different players that defined the dynamics of "Bol/Axact Battle" First the most important players of the battle; Pakistani Media Owners who clubbed together, in an unprecedented fashion, as allies against the BOL/Axact duo. Why? because they realized that BOL's financial model (with large salaries, insurance, shares and perks etc) is a threat to their businesses, will raise their expense beyond their ability to manage and if it continued even for a year it will knock them out. They suspected and alleged that this is not just a commercial business venture; though since 2002 many media entities have financed themselves from outside their balance sheets, investing funds through other businesses or unknown sources (even from outside the country) but in case of BOL some key media platforms felt strongly and even alleged that this represents a plan or "intervention in the market" to weaken them by Pakistani establishment. Some suspected international interests and names of a real estate tycoon were also mentioned. This picture remained confusing but all sides remained convinced of their own versions. During the recent crisis several important media persons before emptying their magazines, loaded with bullets of hate and jealousy, into the chest of BOL wanted to verify if some powerful interests are behind, but drew blank responses from all corners. Pakistani Media interests tried persuading govt into action, against BOL, but govt, though sympathetic for its own reasons and media alliances, was not sure how to act on its own. New York Times was thus drawn into it by certain Pakistani media interests; it appears that initial facts and research into their business rivals "potential wrongdoings" and "suspicious business model/revenue streams" were all shared by the media interests from Karachi. New York Times has written almost 6 times so far on this issue and it appears will continue to follow as it develops providing pretext for action in Pakistan and in all probability in the US. What is interesting is that NYT lacks any track record of substantive interest in "Diploma Mills" or "Fake Degrees" within the US. It has never taken much interest in all scandals that broke like the "Saint Regis University" and has ignored international reports that appeared from time to time that pointed that both US and UK have become the biggest centers of suspicious online diploma/degrees. So why such a strong interest this time? Not only five news reports but also a position by the New York Times Editorial Board asking Congress to look into the whole issue. However NYT Editorial - with its appeals to Congress - also proved that no real legal framework with teeth exists within the US to deal with the kind of fraud Axact is alleged to have been involved with. This is because in the $16 trillion plus economy genuine education is well structured through an interlocking mechanism of standardized testing. US system does allow diplomas/certificates/degrees in lieu of life experiences and online study etc and apparently this loosely structured low end market is not very well regulated and many mavericks like Axact (as per allegation) are exploiting this, under the radar and so far the US lawmakers and enforcement agencies are not much bothered about this $1 Billion segment of a $16 trillion economy. This brings in Pakistani FIA. Some people familiar with what is happening thus think that FIA action was conceived before NYT story. Many people were aware that story was developing. However without FIA action in Karachi it was difficult or may be impossible for FBI to initiate an action on its own. This explains the importance of FIA action and the urgency in which it was apparently initiated and where it ultimately fits into. The real question for FIA/FBI to determine will be that 130 plus Diploma sites were all different standalone entities or were controlled by a single umbrella company like Axact. It is pretty obvious that whatever hanky panky or serious irregularities and abuse Axact may or may not have been doing was of little interest to FBI and regulators or even New York Times in the US or governments in Pakistan. So if Axact did not have he audacity of launching a large media platform it could have continued exploiting the legal loopholes that existed. This underscores that in the new global order media platforms with "significant capacity" the kind of which BOL hinted at are seen as tools of power and control and as threats to entrenched interests- and cannot be allowed to operate without the approval of right quarters. So BOL did not have any real consensus behind it. Its like Banking, BCCI example not exactly relevant but interesting here; it had to fold because it did not have the support of a large political power behind it, was doing audacious hanky panky that included defiance of international consensus on monetary issues; like extending credit to certain countries being disciplined by financial denials. But what is in it for New York Times? As I have noted it has little track record of interest in "diploma mills" in the US and given its global range of interests will be least bothered to enter into a highly personalized battle between Pakistani Seths. Many familiar with NYT argue that Pakistan state does not fit well in its world view, if its upto NYT then Pakistan would have ceased as a country long time ago or would have voluntarily merged into India; so its interests are in Pakistani state, nuclear issue, establishment wrong doings and so on. Could it be possible that its friends and allies in Pakistani media have convinced NYT that a deeper probe will lead to something bigger that can fit into its regional and international interests? So lets see if NYT finds what it is really looking for - that is certainly not the Diploma Mills. Avoiding tax, Axact moved Rs8 billion from UAE to Pakistan By Our Correspondent Published: May 23, 2015 91 SHARES Share Tweet Email Company failed to prove money was generated through software sales. PHOTO: AFP Company failed to prove money was generated through software sales. PHOTO: AFP KARACHI: Axact moved more than Rs8 billion in tax-free, foreign currency from Dubai to Pakistan over the last four years, a Federal Investigation Agency (FIA) probe has revealed, as the bureau prepares to register cases of money-laundering, tax evasion and illegal use of cyberspace against the IT company. Investigators scrutinising Axact’s financial records, including audit reports and balance sheets, said the company transferred foreign exchange worth Rs1 billion to Pakistan in 2011. This amount, they said, was presented as income from the sale of software and IT-related services. The company moved the funds without paying any tax by taking advantage of government concessions aimed at promoting software export. In 2012, Axact moved thrice the amount to Pakistan, investigators said, avoiding tax using the aforementioned concessions. The company continued this practice over subsequent years until, by 2014, it had moved as much as Rs8 billion to Pakistan without paying any tax on the income, they added. According to investigators, the money was transferred to Pakistan via Dubai through transactions involving a few hundred to thousands of dollars. Sources said Axact is adamant that this foreign exchange was generated by the sale of software and IT services. But investigators said the company has failed to provide documentary evidence to back up the claim. If the income was generated from any means other than the sale of software and IT services, then Axact has committed money-laundering, they added. FIA officials are preparing to lodge three to four cases against Axact on charges of money-laundering, tax evasion and illegal use of cyberspace based on irregularities found in the company’s financial records. The agency’s IT and forensic experts have also collected important evidence from emails and computers, sources said. The FIA director is set to present a comprehensive report on evidence against Axact collected so far to Interior Minister Chaudhry Nisar Ali Khan today (Saturday), they said. A decision on whether cases will be registered immediately or if investigators will be given more time to collect additional proofs will be taken after the meeting, the sources added. Published in The Express Tribune, May 23rd, 2015. ========= Pakistan Widens Inquiry Into Fake Diplomas By DECLAN WALSHMAY 22, 2015 Photo People gather at the entrance of an Axact company building after a raid by the Federal Investigation Agency. Credit Farooq Naeem/Agence France-Presse — Getty Images Continue reading the main story Share This Page Email Share Tweet Save more Continue reading the main story Advertisement Continue reading the main story LONDON — Heavy scrutiny by investigators, politicians and the fractious Pakistani media sector has mounted over the past week for Axact, a Karachi-based software company that has made millions selling fake degrees through a sprawling empire of school websites. The tax authorities, the Interior Ministry and the Securities and Exchange Commission of Pakistan, among others, have announced inquiries into the company’s operations. Its Karachi headquarters and a smaller office in Islamabad were sealed after a raid by the authorities earlier in the week. The company’s founder, Shoaib Ahmed Shaikh, has been summoned to an interview with federal investigators. Continue reading the main story Related Coverage Axact, which has its headquarters in Karachi, Pakistan, ostensibly operates as a software company. Fake Diplomas, Real Cash: Pakistani Company Axact Reaps MillionsMAY 17, 2015 Axact runs hundreds of websites, many of which purport to be online universities and high schools based in the United States. Pakistani Investigators Raid Offices of Axact, Fake Diploma CompanyMAY 19, 2015 Open Source: Axact, Fake Diploma Company, Threatens Pakistani Bloggers Who Laugh at Its ExpenseMAY 18, 2015 Tracking Axact’s WebsitesMAY 17, 2015 Axact has thrived for more than a decade on its ability to hide links between its operation in Karachi and hundreds of fictitious online schools, many of them claiming to be American. But more such links are coming to light in the days since The New York Times published a detailed account of the company’s operations, and Axact’s chief executive has begun shifting his tack in public statements. At first, Mr. Shaikh insisted that the only link between Axact and the hundreds of fake school sites was that his company sold software to what he called “associates and partners.” In a television interview on Wednesday, however, he conceded that Axact provided office-support and call-center services for those websites. Still, he continued to deny being a part of any scam. “Axact does not issue any degree or diploma, whether real or fake,” Mr. Shaikh said in the interview. In the past few days, the company’s array of fake online universities and high schools has gone silent. In calls and text messages to 111 websites identified as being operated by Axact, a New York Times reporter was unable establish contact with a single sales agent. The scandal has driven intense coverage by the Pakistani television news media, much of it on stations whose owners were already at odds with Mr. Shaikh, ostensibly over his plans to start his own television network, Bol, in the coming months. Television crews have been camped outside the company’s Karachi headquarters all week. Away from the media glare, people at differing ends of Axact’s elaborate degree scheme have continued to come forward with their accounts. Sikander Riaz, who said he worked as a sales agent under the pseudonym Hank Moody for six weeks last summer, was one of a dozen people who contacted The New York Times to identify themselves as former Axact employees, and were able to provide consistent and detailed descriptions of the organization. Mr. Riaz, a 22-year-old communications student, said he had been tasked to sell degrees for Harvey University and Nixon University out of an Islamabad-based call center for Axact. “Our punch line was that we could give customers a degree in 10 to 15 days,” he said. Another former employee, who asked to be identified only as Ahmad, part of his full name, expressed regret. “I feel bad about people I ripped off,” he said. “I could never tell my family that I sold degrees that destroyed people’s lives.” Continue reading the main story Ahmad said he averaged sales of $500,000 per quarter, on behalf of fake high schools with names like Belford, Lorenz and Adison, during a three-year stint at Axact. By the time he left in 2012, the company was taking in $80,000 to $100,000 a day, he said, providing copies of his pay stubs to prove he had been employed by Axact. He said that many of his early customers were young Americans seeking a high school diploma to fulfill a requirement for enlisting in the Army to fight in Iraq and Afghanistan. “We would celebrate like crazy if we hit $125,000 a day,” he said. Unraveling Axact’s complex system of payments and revenues — much of which former employees have said is routed through offshore companies — is one potential challenge for the seven-member government investigation team announced by Interior Minister Chaudhry Nisar Ali Khan on Wednesday. Former employees said that Axact uses at least 20 offshore companies to process customer revenues, pay suppliers and purposefully create a shield between Axact and the financial affairs of its websites. Many of those companies the employees identified, such as EduConnect and Education SP, have their own websites and say they sell educational software. One such firm, Connect Shift, which is registered in Cyprus, lists Mr. Shaikh as its chief executive, according to company registration records. Axact has left some traces of American connections as well. They include mailboxes in California, Colorado and Texas, and two Bank of America accounts at a branch in Florida that two former customers of Axact-run school sites said had been provided as a place to send payments. By several accounts, Axact’s main financial and logistical hub outside Pakistan is in Dubai, where its holding company, Axact FZ, is located. Reporters for The Khaleej Times newspaper who visited the registered office of Axact FZ this week described a deserted glass cubicle with a desk and two chairs. For years, former employees said, Axact’s diploma certificates were shipped to customers across the globe through a courier service in Dubai, to give the impression of being based in that city’s free trade zone. But that facade nearly collapsed in 2009, when a technology journalist from Saudi Arabia started looking more closely. The journalist, Molouk Ba-Isa, was following up on a report that Rochville University had awarded a masters in business administration to an American pug named Chester. Although Rochville’s physical location was a mystery, Ms. Ba-Isa learned from a courier company official in Dubai that the degree originated from Axact’s office in Karachi. But when The Arab News published her report, naming Axact, she said her editors received a strongly worded legal threat from company lawyers, and the article was removed from the Internet. This week, Ms. Ba-Isa said in an email that she felt vindicated. Former customers of the fake online schools spoke of frustration and anger in their dealings with universities they thought were based in the United States. Mary, a businesswoman in Dubai who wanted to be identified only by part of her name, said she spent $210,000 with Paramount California University in the hope of a genuine third-level business qualification. “I was paying for an education, not buying a degree,” she said. “I’ve only got a high school education, so I did it for my own self worth, and nothing else.” Mary said she and her husband enrolled for business degrees they hoped to study for at home over the winter. Instead she found herself being pursued and hectored by sales agents into making ever-greater payments for fees, registration and legalization. As she started to suspect a fraud, her confusion turned to denial and then anger. “I didn’t know where to turn,” said Mary, who has hired an American lawyer to help seek a refund. “People say, ‘How could you be so stupid?’ I was one of the stupid ones.” Griff Palmer contributed reporting from New York, and Saba Imtiaz from Karachi, Pakistan. A version of this article appears in print on May 23, 2015, on page A8 of the New York edition with the headline: Pakistan Widens Inquiry Into Fake Diplomas . Order Reprints| Today's Paper|Subscribe =========== Why I Left Axact? The Inside Picture. May 19th, 2015 | 20 Comments Kasim Osmani Yeterday, social media lashed out at Axact after NYT report disclosed its million-dollars fake degrees scam. Axact appears to be ‘world’s leading IT company’ as its slogan reads; however, most of its office floors (at least at DHA) are occupied with agents who operate in Middle East region luring Arab/international people with certified US degrees solely on basis of their professional experience. These degrees range from Bachelors, Masters, and PhD (Axact takes pains to prepare thesis for you as well, if you don’t have enough time or skills!). Agents are advised to use Bayt.com or Linkdin as source and it is said to customer that either of these organizations have forwarded his/her profile for consultations. As a matter of fact, while I was working at Axact’s DHA office, the Bayt.com, largest job search engine in Middle East, warned Axact not to use their name as source, after which, we were advised to use Linkdin or else manipulate the script somehow. Axact agents tell customers the main reason why big corporations do not hire you is absence of bachelors, masters, or PhD degree that they can get sitting home. Our script read like: “you don’t have to take classes, or, listen to online lectures, or take pains for admissions and other documented procedures. Just log on to our university website and our Senior Academic Officer will enroll you. It takes less than five minutes and you receive internationally certified/attested degree within couple of months solely based on your professional experience. ” Indeed, there is no criterion for professional experience of the applicant. You may get even PhD degree with as minimum as one year personal experience. It is all situational and manipulative. Only thing that matters is to pay enrollment fee after logging on to university website, and then, continue to pay unless your accounts are squeezed to figure zero. Once a customer pays enrollment fee, he is in the trap. Now, senior agents (closers) would call him from time to time asking more and more money for attestations from concerning embassies and/or shipment charges until his pocket runs dry. It was quite an embarrassing and decisive day for me to quite Axact, when a customer was probably fed up with paying extra attestation/registration fee. The senior agent asked him to wait for a moment so they could bring Mr.ABC from Egyptian embassy over conference call, who would guide you further as to why that attestation is mandatory. Indeed, there was no Mr.ABC from Egyptian embassy; rather, it was one of senior Axact agents who spoke like native Arabs. He sat beside the agent who was already on phone and pretended to be talking from embassy. They ultimately got him pay more for that attestation. This is one out of hundreds of calls each day. As for the universities that offer degrees on basis of professional experience, all are virtual and have no physical address, though they appear to be located in the United States (and so do agents tell to customers). According to NYT report, these university websites are registered in Cyprus and Latvia. The punch line for all this business is “a degree solely based on professional experience”. An idea that dates back to the close of World War II, when many retired soldiers were jobless and the US Government issued special provisions allowing soldiers to obtain academic degrees on basis of their experience so they could get employment to earn livelihood. Have said all this, I admit the silence I had adopted for so long. However, it always made me uncomfortable to think as to what is going at Axact. Whatever I have said above is, I say on oath, 100% true. I have tried to give neutral inside picture and want readers to decide it is legal or not. This is what has been going on at Axact floors for years. Many employees would say degrees are made-in-Karachi and I would try to shun each possibility as rumor. However, for me, the NYT report has proved to be the last nail on Axact’s coffin. I left Axact within a month of my joining in sales department, thinking it too controversial to continue with. According to agreement, we were bound not to disclose the nature of job as people generally do not understand. Today, all I want is proper investigations that could declare this creepy business as legal or illegal and take practical action accordingly, since it is matter of Pakistan’s reputation in entire world and it is about education, the holiest of human professions. ============ Fake diplomas, real cash: Pakistani company Axact reaps millions By Declan Walsh Published: May 18, 2015 PHOTO: THE NEW YORK TIMES Seen from the Internet, it is a vast education empire: hundreds of universities and high schools, with elegant names and smiling professors at sun-dappled American campuses. Their websites, glossy and assured, offer online degrees in dozens of disciplines, like nursing and civil engineering. There are glowing endorsements on the CNN iReport website, enthusiastic video testimonials, and State Department authentication certificates bearing the signature of Secretary of State John Kerry. “We host one of the most renowned faculty in the world,” boasts a woman introduced in one promotional video as the head of a law school. “Come be a part of Newford University to soar the sky of excellence.” Yet on closer examination, this picture shimmers like a mirage. The news reports are fabricated. The professors are paid actors. The university campuses exist only as stock photos on computer servers. The degrees have no true accreditation. In fact, very little in this virtual academic realm, appearing to span at least 370 websites, is real — except for the tens of millions of dollars in estimated revenue it gleans each year from many thousands of people around the world, all paid to a secretive Pakistani software company. That company, Axact, operates from the port city of Karachi, where it employs over 2,000 people and calls itself Pakistan’s largest software exporter, with Silicon Valley-style employee perks like a swimming pool and yacht. Axact does sell some software applications. But according to former insiders, company records and a detailed analysis of its websites, Axact’s main business has been to take the centuries-old scam of selling fake academic degrees and turn it into an Internet-era scheme on a global scale. As interest in online education is booming, the company is aggressively positioning its school and portal websites to appear prominently in online searches, luring in potential international customers. At Axact’s headquarters, former employees say, telephone sales agents work in shifts around the clock. Sometimes they cater to customers who clearly understand that they are buying a shady instant degree for money. But often the agents manipulate those seeking a real education, pushing them to enroll for coursework that never materializes, or assuring them that their life experiences are enough to earn them a diploma. To boost profits, the sales agents often follow up with elaborate ruses, including impersonating American government officials, to persuade customers to buy expensive certifications or authentication documents. Revenues, estimated by former employees and fraud experts at several million dollars per month, are cycled through a network of offshore companies. All the while, Axact’s role as the owner of this fake education empire remains obscured by proxy Internet services, combative legal tactics and a chronic lack of regulation in Pakistan. “Customers think it’s a university, but it’s not,” said Yasir Jamshaid, a quality control official who left Axact in October. “It’s all about the money.” Axact’s response to repeated requests for interviews over the past week, and to a list of detailed questions submitted to its leadership on Thursday, was a letter from its lawyers to The New York Times on Saturday. In the letter, it issued a blanket denial, accusing a Times reporter of “coming to our client with half-cooked stories and conspiracy theories.” In an interview in November 2013 about Pakistan’s media sector, Axact’s founder and chief executive, Shoaib Ahmed Shaikh, described Axact as an “I.T. and I.T. network services company” that serves small and medium-sized businesses. “On a daily basis we make thousands of projects. There’s a long client list,” he said, but declined to name those clients. The accounts by former employees are supported by internal company records and court documents reviewed by The New York Times. The Times also analyzed more than 370 websites — including school sites, but also a supporting body of search portals, fake accreditation bodies, recruitment agencies, language schools and even a law firm — that bear Axact’s digital fingerprints. In academia, diploma mills have long been seen as a nuisance. But the proliferation of Internet-based degree schemes has raised concerns about their possible use in immigration fraud, and about dangers they may pose to public safety and legal systems. In 2007, for example, a British court jailed Gene Morrison, a fake police criminologist who claimed to have degree certificates from the Axact-owned Rochville University, among other places. Little of this is known in Pakistan, where Axact has dodged questions about its diploma business and has portrayed itself as a roaring success and model corporate citizen. “Winning and caring” is the motto of Mr. Shaikh, who claims to donate 65 percent of Axact’s revenues to charity, and last year announced plans for a program to educate 10 million Pakistani children by 2019. More immediately, he is working to become Pakistan’s most influential media mogul. For almost two years now, Axact has been building a broadcast studio and aggressively recruiting prominent journalists for Bol, a television and newspaper group scheduled to start this year. Just how this ambitious venture is being funded is a subject of considerable speculation in Pakistan. Axact has filed several pending lawsuits, and Mr. Shaikh has issued vigorous public denials, to reject accusations by media competitors that the company is being supported by the Pakistani military or organized crime. What is clear, given the scope of Axact’s diploma operation, is that fake degrees are likely providing financial fuel for the new media business. “Hands down, this is probably the largest operation we’ve ever seen,” said Allen Ezell, a retired F.B.I. agent and author of a book on diploma mills who has been investigating Axact. “It’s a breathtaking scam.” Building a Web At first glance, Axact’s universities and high schools are linked only by superficial similarities: slick websites, toll-free American contact numbers and calculatedly familiar-sounding names, like Barkley, Columbiana and Mount Lincoln. But other clues signal common ownership. Many sites link to the same fictitious accreditation bodies and have identical graphics, such as a floating green window with an image of a headset-wearing woman who invites customers to chat. There are technical commonalities, too: identical blocks of customized coding, and the fact that a vast majority route their traffic through two computer servers run by companies registered in Cyprus and Latvia. Five former employees confirmed many of these sites as in-house creations of Axact, where executives treat the online schools as lucrative brands to be meticulously created and forcefully marketed, frequently through deception. The professors and bubbly students in promotional videos are actors, according to former employees, and some of the stand-ins feature repeatedly in ads for different schools. The sources described how employees would plant fictitious reports about Axact universities on iReport, a section of the CNN website for citizen journalism. Although CNN stresses that it has not verified the reports, Axact uses the CNN logo as a publicity tool on many of its sites. Social media adds a further patina of legitimacy. LinkedIn contains profiles for purported faculty members of Axact universities, like Christina Gardener, described as a senior consultant at Hillford University and a former vice president at Southwestern Energy, a publicly listed company in Houston. In an email, a Southwestern spokeswoman said the company had no record of an employee with that name. The heart of Axact’s business, however, is the sales team — young and well-educated Pakistanis, fluent in English or Arabic, who work the phones with customers who have been drawn in by the websites. They offer everything from high school diplomas for about $350, to doctoral degrees for $4,000 and above. “It’s a very sales-oriented business,” said a former employee who, like several others, spoke on the condition of anonymity because he feared legal action by Axact. A new customer is just the start. To meet their monthly targets, Axact sales agents are schooled in tough tactics known as upselling, according to former employees. Sometimes they cold-call prospective students, pretending to be corporate recruitment agents with a lucrative job offer — but only if the student buys an online course. A more lucrative form of upselling involves impersonating American government officials who wheedle or bully customers into buying State Department authentication certificates signed by Secretary Kerry. Such certificates, which help a degree to be recognized abroad, can be lawfully purchased in the United States for less than $100. But in Middle Eastern countries, Axact officials sell the documents — some of them forged, others secured under false pretenses — for thousands of dollars each. “They would threaten the customers, telling them that their degrees would be useless if they didn’t pay up,” said a former sales agent who left Axact in 2013. Axact tailors its websites to appeal to customers in its principal markets, including the United States and oil-rich Persian Gulf countries. One Saudi man spent over $400,000 on fake degrees and associated certificates, said Mr. Jamshaid, the former employee. Usually the sums are less startling, but still substantial. One Egyptian man paid $12,000 last year for a doctorate in engineering technology from Nixon University and a certificate signed by Mr. Kerry. He acknowledged breaking ethical boundaries: His professional background was in advertising, he said in a phone interview, speaking on the condition of anonymity to avoid potential legal trouble. But he was certain the documents were real. “I really thought this was coming from America,” he said. “It had so many foreigner stamps. It was so impressive.” Real-Life Troubles Many customers of degree operations, hoping to secure a promotion or pad their résumé, are clearly aware that they are buying the educational equivalent of a knockoff Rolex. Some have been caught. In the United States, one federal prosecution in 2008 revealed that 350 federal employees, including officials at the departments of State and Justice, held qualifications from a non-Axact-related diploma mill operation based in Washington State. Some Axact-owned school websites have previously made the news as being fraudulent, though without the company’s ownership role being discovered. In 2013, for instance, Drew Johansen, a former Olympic swim coach, was identified in a news report as a graduate of Axact’s bogus Rochville University. The effects have sometimes been deeply disruptive. In Britain, the police had to re-examine 700 cases that Mr. Morrison, the falsely credentialed police criminologist and Rochville graduate, had worked on. “It looked easier than going to a real university,” Mr. Morrison said during his 2007 trial. In the Middle East, Axact has sold aeronautical degrees to airline employees, and medical degrees to hospital workers. One nurse at a large hospital in Abu Dhabi, United Arab Emirates, admitted to spending $60,000 on an Axact-issued medical degree to secure a promotion. But there is also evidence that many Axact customers are dupes, lured by the promise of a real online education. Elizabeth Lauber, a bakery worker from Bay City, Mich., had been home-schooled, but needed a high school diploma to enroll in college. In 2006, she called Belford High School, which had her pay $249 and take a 20-question knowledge test online. Weeks later, while waiting for the promised coursework, Ms. Lauber was surprised to receive a diploma in the mail. But when she tried to use the certificate at a local college, an official said it was useless. “I was so angry,” she said by phone. Last May, Mohan, a junior accountant at a construction firm in Abu Dhabi, paid $3,300 for what he believed was going to be an 18-month online master’s program in business administration at the Axact-owned Grant Town University. A sales agent assured Mohan, a 39-year-old Indian citizen who asked to be identified only by part of his name, of a quality education. Instead, he received a cheap tablet computer in the mail — it featured a school logo but no education applications or coursework — followed by a series of insistent demands for more money. When a phone caller who identified himself as an American Embassy official railed at Mohan for his lack of an English-language qualification, he agreed to pay $7,500 to the Global Institute of English Language Training Certification, an Axact-run website. In a second call weeks later, the man pressed Mohan to buy a State Department authentication certificate signed by Mr. Kerry. Mohan charged $7,500 more to his credit card. Then in September a different man called, this time claiming to represent the United Arab Emirates government. If Mohan failed to legalize his degree locally, the man warned, he faced possible deportation. Panicking, Mohan spoke to his sales agent at Axact and agreed to pay $18,000 in installments. By October, he was $30,000 in debt and sinking into depression. He had stopped sending money to his parents in India, and hid his worries from his wife, who had just given birth. “She kept asking why I was so tense,” said Mohan during a recent interview near his home in Abu Dhabi. “But I couldn’t say it to anyone.” Chasing Bill Gates In Pakistan, Mr. Shaikh, Axact’s chief executive, portrays himself as a self-made tycoon of sweeping ambition with a passion for charity. Growing up in a one-room house, he said in a speech posted on the company’s website, his goal was to become “the richest man on the planet, even richer than Bill Gates.” At gala company events he describes Axact, which he founded in 1997, as a global software leader. His corporate logo — a circular design with a soaring eagle — bears a striking resemblance to the American presidential seal. Unusual for a software entrepreneur, Mr. Shaikh does not habitually use email or a cellphone, said several people recruited to his new station, Bol. But his ambition is undimmed: Last year he announced plans for Gal Axact, a futuristic headquarters building with its own monorail system and space for 20,000 employees. His philanthropic vision, meanwhile, has a populist streak that resonates with many Pakistanis’ frustrations with their government. As well as promising to educate 10 million children, Mr. Shaikh last year started a project to help resolve small civil disputes — a pointed snub to the country’s sclerotic justice system — and vowed to pump billions of dollars into Pakistan’s economy. There is no power in the universe that can prevent us from realizing this dream,” he declared in the speech. But some employees, despite the good salaries and perks they enjoyed, became disillusioned by the true nature of Axact’s business. During three months working in the internal audit department last year, monitoring customer phone calls, Mr. Jamshaid grew dismayed by what he heard: customers being cajoled into spending tens of thousands of dollars, and tearful demands for refunds that were refused. “I had a gut feeling that it was not right,” he said. In October, Mr. Jamshaid quit Axact and moved to the United Arab Emirates, taking with him internal records of 22 individual customer payments totaling over $600,000. Mr. Jamshaid has since contacted most of those customers, offering to use his knowledge of Axact’s internal protocols to obtain refunds. Several spurned his approach, seeing it as a fresh effort to defraud them. But a few, including Mohan, accepted his offer. After weeks of fraught negotiations, Axact refunded Mohan $31,300 last fall. The Indian accountant found some satisfaction, but mostly felt chastened and embarrassed. “I was a fool,” he said, shaking his head. “It could have ruined me.” Deception and Threats Axact’s role in the diploma mill industry was nearly exposed in 2009 when an American woman in Michigan, angry that her online high school diploma had proved useless, sued two Axact-owned websites, Belford High School and Belford University. The case quickly expanded into a class-action lawsuit with an estimated 30,000 American claimants. Their lawyer, Thomas H. Howlett, said in an interview that he found “hundreds of stories of people who have been genuinely tricked,” including Ms. Lauber, who joined the suit after it was established. But instead of Axact, the defendant who stepped forward was Salem Kureshi, a Pakistani who claimed to be running the websites from his apartment. Over three years of hearings, his only appearance was in a video deposition from a dimly lit room in Karachi, during which he was barely identifiable. An associate who also testified by video, under the name “John Smith,” wore sunglasses. Mr. Kureshi’s legal fees of over $400,000 were paid to his American lawyers through cash transfers from different currency exchange stores in Dubai, court documents show. Recently a reporter was unable to find his given address in Karachi. “We were dealing with an elusive and illusory defendant,” said Mr. Howlett, the lawyer for the plaintiffs. In his testimony, Mr. Kureshi denied any links to Axact, even though mailboxes operated by the Belford schools listed the company’s headquarters as their forwarding address. The lawsuit ended in 2012 when a federal judge ordered Mr. Kureshi and Belford to pay $22.7 million in damages. None of the damages have been paid, Mr. Howlett said. Today, Belford is still open for business, using a slightly different website address. Former Axact employees say that during their inductions into the company, the two schools were held out as prized brands. Axact does have regular software activities, mainly in website design and smartphone applications, former employees say. Another business unit, employing about 100 people, writes term papers on demand for college students. But the employees say those units are outstripped by its diploma business, which as far back as 2006 was already earning Axact around $4,000 a day, according to a former software engineer who helped build several sites. Current revenues are at least 30 times higher, by several estimates, and are funneled through companies registered in places like Dubai, Belize and the British Virgin Islands. Axact has brandished legal threats to dissuade reporters, rivals and critics. Under pressure from Axact, a major British paper, The Mail on Sunday, withdrew an article from the Internet in 2006. Later, using an apparently fictitious law firm, the company faced down a consumer rights group in Botswana that had criticized Axact-run Headway University. It has also petitioned a court in the United States, bringing a lawsuit in 2007 against an American company that is a competitor in the essay-writing business, Student Network Resources, and that had called Axact a “foreign scam site.” The American company countersued and was awarded $700,000, but no damages have been paid, the company’s lawyer said. In his interview with The New York Times in 2013, Axact’s chief executive, Mr. Shaikh, acknowledged that the company had faced criticism in the media and on the Internet in Britain, the United States and Pakistan, and noted that Axact had frequently issued a robust legal response. “We have picked up everything, we have gone to the courts,” he said. “Lies cannot flourish like that.” Mr. Shaikh said that the money for Axact’s new media venture, Bol, would “come from our own funds.” With so much money at stake, and such considerable effort to shield its interests, one mystery is why Axact is ready to risk it all on a high-profile foray into the media business. Bol has already caused a stir in Pakistan by poaching star talent from rival organizations, often by offering unusually high salaries. Mr. Shaikh says he is motivated by patriotism: Bol will “show the positive and accurate image of Pakistan,” he said last year. He may also be betting that the new operation will buy him influence and political sway. In any event, Axact’s business model faces few threats within Pakistan, where it does not promote its degrees. When reporters for The Times contacted 12 Axact-run education websites on Friday, asking about their relationship to Axact and the Karachi office, sales representatives variously claimed to be based in the United States, denied any connection to Axact or hung up immediately. “This is a university, my friend,” said one representative when asked about Axact. “I have no idea what you’re talking about.” The article was originally published in The New York Times Read the list of sites allegedly run by Axact here =============== Ali S Pakistan Google Chrome Windows says: May 19, 2015 at 4:36 pm This story should be a lot bigger – I’ve noticed that a lot of commenters who had same experience at Axact say the same things. They’re running one of the world’s biggest fake degree scams and are now encroaching upon Pakistan’s media space to legitimize themselves. Anyone who’s seen Shoaib Ahmed Shaikh speak knows that he has ‘con job’ written all over him. And Axact just shot itself in the foot by having its lawyers (who knows if it’s even a real law firm, their manuscript seemed unprofessional) sue an online blog – now New York Times has picked up Axact’s attempt to shut down free speech and it’s going viral around the world. http://www.nytimes.com/2015/05/19/world/asia/axact-fake-diploma-company-threatens-pakistani-bloggers-who-laugh-at-its-expense.html Shahzad Afzal United Arab Emirates Google Chrome Windows says: May 19, 2015 at 6:39 pm I remember since my university time Axact was a shady company. There were rumors about their “Porn” business as well. But this fake degree empire is even worst than porn business. It would not have brought this much shame to Pakistan. and Axact can’t deny now.. all their sites including Axact.com, freeinsaf.com and even bolnetwork.com are leading to same hosting server which is owned by company. This same server is hosting most of the fake university websites. [Proof] Axact website and Fake University’s websites are owned by Axact itself – See more at: http://www.pakistanprobe.com/2015/05/proof-axact-website-and-fake-university-websites-are-owned-by-Axact-itself.html#.VVs-G_mqqko David Saudi Arabia Google Chrome Windows says: May 19, 2015 at 6:57 pm I worked for Axact for period of 3 months in 2013 as a Senior Brand Manager and I left as soon as I worked out their business model. I can testify that all of what has been said by Kasim is true, most people leave the company realizing their mistake of joining within months without backup employment like I did. We all land on our feet though. But Kasim had more courage than I did leaving such a lucrative package so soon. There are too many websites to count and the revenue is within the billions by now. The trouble with Axact is, and this is something that I have always maintained, they have a fantastic ERP product portfolio that was put together by some of the sharpest minds in the country. They just chose the easy money route. I must also point out here that the company does not and has never participated in building or maintaining porn websites. That is just a rumor. They buy space to host their fraudulent websites from GoDaddy so they do not even host the content. Jagreets Google Chrome Windows says: May 19, 2015 at 7:13 pm What is DHA? In article mention many office floors(at least in DHA)? mango Pakistan Mozilla Firefox Windows says: May 19, 2015 at 7:47 pm @Jagreets DHA is Defence Housing Authority. Its an area in Karachi where offices, banks and residential bungalows are located. AXACT’s Karachi building is located in DHA area. merchant India Google Chrome GT-I8552 Build/JZO54K) AppleWebKit/537.36 (KHTML, like Gecko) Chrome/42.0.2311.111 Mobile Safari/537.36 says: May 19, 2015 at 8:04 pm Surprised to see you pakis surprised. conjob was the way you got your country. .aap log toh hotey hee sapoliya ho.. shahbaz Google Chrome Windows says: May 19, 2015 at 8:07 pm I’m a bit dismayed at all this talk of this company causing a bad name for Pakistan. If that is the only concern, then an equally good solution to Axact’s alleged misdeeds is to cover up the problem, blame NYT and the whistle blowers, complain about foreigners airing our dirty laundry. IF THE ALLEGATIONS ARE TRUE, these people caused real financial and psychological damage to lots of people. If this company was selling fake degrees to cheaters who were looking to buy fake credentials, then the company and their customers deserve each other. However, there are allegations of Axact defrauding a large number of people, many of whom spent a great deal of money attempting to improve their lives. I am heartened that people like Jehan Ara had already called them out. I am further encouraged that many of their employees saw what they were doing and decided to give up lucrative salaries in favor of cleaner living. Hindu Hater Pakistan Google Chrome Windows says: May 19, 2015 at 8:32 pm @merchant kiyu yeh sapoliya teri behn ki choot man ghus gaye han kiya. Kutti ka bacha hindu. apnay kam say kam rekho. jo tumhari basoon man ho reha ha sari duniya ko pataa ha. Zoya Anwar Pakistan Google Chrome Windows says: May 19, 2015 at 8:55 pm Yes! I already listen this type of story form my one friend Sumayra. But I can’t believe that time. But today after reading this article I must believe on these true stories. Sahil Pakistan Google Chrome Windows says: May 19, 2015 at 9:19 pm I heared Dr. Aamir Liaqat also got his BA and Phd. from Axact. Is that true??? Farooq Pakistan Google Chrome Windows says: May 19, 2015 at 9:38 pm In keeping with high standards of journalism, ethics and legal obligations, Forbes has removed the defamatory NYT story which they referred in their article. http://www.forbes.com/sites/jamesmarshallcrotty/2015/05/18/the-worlds-largest-fake-diploma-mill-finally-exposed/ choli United States Mozilla Windows says: May 19, 2015 at 10:19 pm fuck you merchant. you hindu bastard. yehya Mozilla Firefox Windows says: May 19, 2015 at 11:07 pm Farooq- well hello there, mister Axact Enterprises Public Relations department. YLH Pakistan Safari iPhone says: May 19, 2015 at 11:46 pm Moderators please remove this Merchant joker and those abusing him. timely Germany Mozilla Firefox Windows says: May 20, 2015 at 12:18 am Conjob to get a country – that’s what he said. Is it wrong? It is the speciality of this kaliyuga. you get nothing without con-jobbing in kaliyuga. hindu scripts say that and they are more honest and accurate than those of other religions. – Sincere human beings never end up creating a country or society full of fascism and dishonesty, irrationality and violence-glorification. Rafiq United States Mozilla Firefox Windows says: May 20, 2015 at 1:29 am yet another scam and theivery emanating from our country of pakistan. First, AQ Khan then Bin Laden and now Axact. Better stop Bol now before it stops us all, otherwise sabki bolti band ho jayegi. Axact Scandal Germany Google Chrome Windows says: May 20, 2015 at 1:51 am This is one of the biggest scam in the history and really feel back the man behind all this is a Pakistani! Anum Pakistan Mozilla Firefox Windows says: May 20, 2015 at 2:41 am i was part of AXACT in when i realize the nature of work i resigned from designation as a senior executive brand management within 3 month my JD is to manage fake MUST UNIVERSITY online presence. sherazi Pakistan Google Chrome QMobile i12 Build/KOT49H) AppleWebKit/537.36 (KHTML, like Gecko) Chrome/42.0.2311.111 Mobile Safari/537.36 says: May 20, 2015 at 4:27 am Fuck u all yar plz take a break and think over it its just a fucking article that has divided us. Whatever the case may be we just have to wait and see is it true and the bustards claming to have worked for axect oooo plz cut this crap and prove it that u were part of this organization i can also claim i have slept with sumone wife but is it true think plxxx before reacting sherazi Pakistan Google Chrome QMobile i12 Build/KOT49H) AppleWebKit/537.36 (KHTML, like Gecko) Chrome/42.0.2311.111 Mobile Safari/537.36 says: May 20, 2015 at 4:31 am And my brothers and sisters plx before u defame our beloved country anymore infront of these fucking hindu bastards plx relax at this point of tym we need to look for solutions rather then spraying the shit all around so plx coment but dont become asma jahngir wat a slut she is ;) =============================================