Pak man pleads guilty in USD 140 mn diploma mill fraud in US

A 31-year old Pakistani man has pleaded guilty to his role in a 140 million dollar school and college "diploma mill" fraud run through a Pakistani company that was shut down by the country's law enforcement.
Umair Hamid of Karachi plead guilty yesterday before US District Judge Ronnie Abrams to conspiracy to commit wire fraud in connection with the international diploma mill scheme that collected tens of millions of dollars from thousands of customers. The charge carries a maximum sentence of 20 years in prison and Hamid will be sentenced in July.
He was arrested in last December for his role in the scheme that collected approximately USD 140 million from tens of thousands of consumers, the Southern District of New York had said.

As alleged in the indictment, Hamid and his co-conspirators made false 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 consumers.
"Operating from Pakistan, Hamid helped fraudulently rake in millions of dollars from unwitting American consumers who paid to enroll in, and get degrees from, high schools and colleges that did not exist. As a result of his fraud, people who thought they were investing in an education received nothing more than worthless diplomas and a harsh lesson in the worldwide reach of deceit," Acting US Attorney Joon Kim said.

Hamid, using the aliases "Shah Khan" and the "Shah", and others operated a massive education "diploma mill" through the Pakistani company Axact, which described itself as one of the world's leading information technology providers.

Hamid served as Axact's Assistant Vice President of International Relations and made misrepresentations to individuals across the world, including throughout the US and in New York, in order to dupe these individuals into enrolling in supposed high schools, colleges, and other educational institutions.
Consumers paid upfront fees to Hamid and his co-conspirators, believing that in return they would be enrolled in real educational courses and, eventually, receive legitimate degrees. Instead, after paying the upfront fees, consumers did not receive any legitimate instruction and were provided fake and worthless diplomas.

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 enroll in educational institutions supposedly affiliated with Axact.
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 persuade the consumer to purchase additional "accreditation" or "certifications" for such certificates or diplomas in order to make them appear more legitimate.

Axact, through Hamid and his co-conspirators, falsely "accredited" purported colleges and other educational institutions by arranging to have diplomas from these phony educational institutions affixed with fake stamps supposedly bearing the seal and signature of the US Secretary of State, as well as various state agencies and federal and state officials.
Hamid controlled websites of purported "schools" that falsely represented that consumers who "enrolled" with the schools by paying tuition fees would receive online instruction and coursework, sold bogus academic "accreditations" in exchange for additional fees and falsely represented that the schools had been certified or accredited by various educational organisations.

As a further part of the scheme, Hamid and a co-conspirator opened bank accounts in the US in the names of shell entities that received funds transferred by consumers in exchange for fake diplomas.
In May 2015, Axact was shut down by Pakistani law enforcement, and certain individuals associated with Axact were prosecuted in Pakistan.
However after May 2015, Hamid resumed his fraudulent business of selling fake diplomas to consumers in the US for upfront fees based upon false and fraudulent representations.
Most recently, Hamid traveled to the US in 2016 in order to open a bank account used to collect money from defrauded consumers.