After Muscat Daily’s report (October 22, 2014) on fake online universities targeting people in Oman and offering degrees for money without requiring any academic participation, The New York Times (NYT) has now done an exposé which puts a Pakistani software company to be behind more than 370 such websites or degree mills.
The only criteria for these degrees happens to be, without a doubt, valid credit cards. The applicant does not need to attend online classes or make study submissions, and the degrees are sent in a little over a fortnight.
Mount Lincoln University, one of the 370 websites linked to the Pakistani company Axact, was contacted by Muscat Daily for its article. A ‘student advisor’ at the university had told the newspaper it could arrange a Master’s degree in management for US$599, or a PhD for US$799 in a topic chosen by the applicant to be delivered in 15-20 days. The university would organise the thesis too – an external process that would cost US$900-US$1,500 for a 150-page document.
Meanwhile, degrees awarded by Rochville University, another Axact university, continue to be listed by hundreds of professionals on their LinkedIn resumes, many of them working in Oman.
The NYT article reported “that 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, reported NYT.
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 real education, pushing them to enroll for coursework that never materialises, 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, said the report.
“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,” the report quoted him saying.
The accounts by former employees are supported by internal company records and court documents reviewed by NYT.
The Times also analysed 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.
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 Axact’s founder and chief executive, Shoaib Ahmed Shaikh, who claims to donate 65 per cent of Axact’s revenues to charity, and last year announced plans for a programme to educate 10mn Pakistani children by 2019.
He is also working to become Pakistan’s most influential media mogul by recruiting prominent journalists for Bol, a television and newspaper group scheduled to start this year.
“Hands down, this is probably the largest operation we’ve ever seen,” said Allen Ezell, a retired FBI agent and author of a book on diploma mills who has been investigating Axact. “It’s a breathtaking scam,” he told NYT.
Building a web
The heart of Axact’s business 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 US$350, to doctoral degrees for US$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. 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 US State Department authentication certificates signed by Secretary of State John Kerry.
“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 US and GCC countries. One Saudi man spent over US$400,000 on fake degrees and associated certificates, said Jamshaid, the former employee.
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, UAE, admitted to spending US$60,000 on an Axact-issued medical degree to secure a promotion, reported NYT.
But there is also evidence that many Axact customers are duped, lured by the promise of a real online education. Mohan, a junior accountant at a construction firm in Abu Dhabi, paid US$3,300 for what he believed was going to be an 18-month online MBA programme at the Axact-owned Grant Town University.
But what followed were tactics to pressurise him into shelling out US$7,500 more for English-language qualification from Global Institute of English Language Training Certification, an Axact-run website.
He was then forced to buy a State Department authentication certificate signed by Kerry for another US$7,500. Then he got a call from a man claiming to represent the UAE government. If Mohan failed to legalise his degree locally, the man warned, he faced possible deportation. Panicking, Mohan spoke to his sales agent at Axact and agreed to pay US$18,000 in installments. By October 2014, he was depressed, with some US$30,000 in debt.
But some employees, despite the good salaries and perks they enjoyed, became disillusioned by the true nature of Axact’s business. During the three months working in the internal audit department last year, monitoring customer phone calls, 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 was quoted by NYT.
Last October, Jamshaid quit Axact and moved to UAE, taking with him internal records of 22 individual customer payments totaling over US$600,000.
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 US$31,300 last fall.
The expat accountant found some satisfaction, but mostly felt chastened and embarrassed. “I was a fool,” he said, shaking his head. “It could have ruined me.”
Follow us: @muscat_daily on Twitter | muscatdailyonline on Facebook