Financial Fraud: Umair Hamid Charged with Wire Fraud, Aggravated Identity Theft, and Worldwide “Diploma Mill” Scheme

<h2>Manhattan U&period;S&period; Attorney Charges Executive Of Axact In &dollar;140 Million Diploma Mill Scam<&sol;h2>&NewLine;<p>Preet Bharara&comma; the United States Attorney for the Southern District of New York&comma; Philip R&period; Bartlett&comma; Inspector-in-Charge of the New York Office of the U&period;S&period; Postal Inspection Service &lpar;&OpenCurlyDoubleQuote;USPIS”&rpar;&comma; and William F&period; Sweeney Jr&period;&comma; the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation &lpar;&OpenCurlyDoubleQuote;FBI”&rpar;&comma; announced today the filing of a criminal Complaint charging UMAIR HAMID&comma; a&sol;k&sol;a &OpenCurlyDoubleQuote;Shah Khan&comma;” a&sol;k&sol;a the &OpenCurlyDoubleQuote;Shah&comma;” with wire fraud&comma; conspiracy to commit wire fraud&comma; and aggravated identity theft in connection with a worldwide &OpenCurlyDoubleQuote;diploma mill” scheme that collected at least approximately &dollar;140 million from tens of thousands of consumers&period;  As alleged&comma; 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&comma; and issued fake diplomas upon receipt of upfront fees from consumers&period;  HAMID was arrested on December 19&comma; 2016&comma; and was presented yesterday in federal court in Fort Mitchell&comma; Kentucky&period;<&sol;p>&NewLine;<div class&equals;"mh-content-ad"><script async src&equals;"https&colon;&sol;&sol;pagead2&period;googlesyndication&period;com&sol;pagead&sol;js&sol;adsbygoogle&period;js&quest;client&equals;ca-pub-9162800720558968"&NewLine; crossorigin&equals;"anonymous"><&sol;script>&NewLine;<ins class&equals;"adsbygoogle"&NewLine; style&equals;"display&colon;block&semi; text-align&colon;center&semi;"&NewLine; data-ad-layout&equals;"in-article"&NewLine; data-ad-format&equals;"fluid"&NewLine; data-ad-client&equals;"ca-pub-9162800720558968"&NewLine; data-ad-slot&equals;"1081854981"><&sol;ins>&NewLine;<script>&NewLine; &lpar;adsbygoogle &equals; window&period;adsbygoogle &vert;&vert; &lbrack;&rsqb;&rpar;&period;push&lpar;&lbrace;&rcub;&rpar;&semi;&NewLine;<&sol;script><&sol;div>&NewLine;<p>Manhattan U&period;S&period; Attorney Preet Bharara said&colon;  &OpenCurlyDoubleQuote;As alleged&comma; while promising the rewards of a higher education&comma; Umair Hamid was actually just peddling diplomas and certifications from fake schools&period;  Hamid allegedly took hefty upfront fees from young men and women seeking an education&comma; leaving them with little more than useless pieces of paper&period;”<&sol;p>&NewLine;<p>USPIS Inspector-in-Charge Philip R&period; Bartlett said&colon;  &OpenCurlyDoubleQuote;Mr&period; Hamid took advantage of the aspirations and dreams of thousands wanting a college education by devising a scheme to issue college coursework&comma; degrees and certifications not worth the paper they were printed on&period; Postal Inspectors and their law enforcement partners will spare no resource to bring these scammers to justice&comma; protecting those striving for higher education and opportunities&period;”<&sol;p>&NewLine;<p>FBI Assistant Director-in-Charge William F&period; Sweeney Jr&period; said&colon;  &OpenCurlyDoubleQuote;Thousands of people’s hopes were crushed as this alleged diploma mill scheme came crashing down&period;  Victims took at face value the lies Hamid and his co-conspirators are alleged to have sold them&period;  Today&comma; we’re rewriting the lesson plan&period;”<&sol;p>&NewLine;<p style&equals;"text-align&colon; left&semi;">According to the allegations contained in the Complaint filed today in Manhattan federal court&colon;<&sol;p>&NewLine;<p style&equals;"text-align&colon; center&semi;"><em><u>The Axact Scheme<&sol;u><&sol;em><&sol;p>&NewLine;<p style&equals;"text-align&colon; left&semi;">HAMID&comma; using the aliases &OpenCurlyDoubleQuote;Shah Khan” and the &OpenCurlyDoubleQuote;Shah&comma;” and others operated a massive education &OpenCurlyDoubleQuote;diploma mill” through the Pakistani company &OpenCurlyDoubleQuote;Axact&comma;” which has held itself out as one of the world’s leading information technology &lpar;&OpenCurlyDoubleQuote;IT”&rpar; providers&period;  Working on behalf of Axact&comma; HAMID and others made misrepresentations to individuals across the world&comma; including throughout the United States and in the Southern District of New York&comma; in order to dupe these individuals into enrolling in supposed high schools&comma; colleges&comma; and other educational institutions&period;  Consumers paid upfront fees to HAMID and his co-conspirators&comma; believing that in return they would be enrolled in real educational courses and&comma; eventually&comma; receive legitimate degrees&period;  Instead&comma; after paying the upfront fees&comma; consumers did not receive any legitimate instruction and were provided fake and worthless diplomas&period;<&sol;p>&NewLine;<p>Axact promoted and claimed to have an affiliation with approximately 350 fictitious high schools and universities&comma; which Axact advertised online to consumers as genuine schools&period;  During certain time periods since 2014&comma; Axact received approximately 5&comma;000 phone calls per day from individuals seeking to purchase Axact products or enroll in educational institutions supposedly affiliated with Axact&period;  At least some of those consumers appeared to believe that they were calling phone numbers associated with the respective schools&period;  When consumers asked where the schools were located&comma; sales representatives were instructed to give fictitious addresses&period;<&sol;p>&NewLine;<p>Once a consumer paid for a school certificate or diploma that falsely reflected a completed course of study&comma; Axact sales agents were trained to use sales techniques to convince the consumer that the consumer should also purchase additional &OpenCurlyDoubleQuote;accreditation” or &OpenCurlyDoubleQuote;certifications” for such certificates or diplomas in order to make them appear more legitimate&period;  Axact&comma; through HAMID and his co-conspirators&comma; falsely &OpenCurlyDoubleQuote;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 U&period;S&period; Secretary of State&comma; as well as various states and state agencies and federal and state officials&period;<&sol;p>&NewLine;<p style&equals;"text-align&colon; center&semi;"><em><u>HAMID’s Role in the Scheme<&sol;u><&sol;em><&sol;p>&NewLine;<p>HAMID served as Axact’s &OpenCurlyDoubleQuote;Assistant Vice President of International Relations&period;”  While based in Pakistan&comma; HAMID was involved in managing and operating online companies that falsely held themselves out to consumers over the Internet as educational institutions&period;  Among other things&comma; HAMID made various false and fraudulent representations to consumers in order to sell fake diplomas&period;  At HAMID’s direction&comma; the websites of purported &OpenCurlyDoubleQuote;schools” &lpar;1&rpar; falsely represented that consumers who &OpenCurlyDoubleQuote;enrolled” with the schools by paying tuition fees would receive online instruction and coursework&comma; &lpar;2&rpar; sold bogus academic &OpenCurlyDoubleQuote;accreditations” in exchange for additional fees&comma; &lpar;3&rpar; falsely represented that the schools had been certified or accredited by various educational organizations&comma; and &lpar;4&rpar; falsely represented that the schools’ degrees were valid and accepted by employers&comma; including in the United States&period;<&sol;p>&NewLine;<p>As a further part of the scheme&comma; HAMID and a co-conspirator &lpar;1&rpar; opened bank accounts in the United States in the names of shell entities&comma; effectively controlled by HAMID&comma; which received funds transferred by consumers in exchange for fake diplomas&comma; &lpar;2&rpar; transferred funds from those bank accounts to bank accounts associated with other entities located elsewhere in the United States&comma; the United Arab Emirates&comma; and Canada&comma; at the direction of HAMID&comma; and &lpar;3&rpar; opened and operated an account with Paypal&comma; the online payment service provider&comma; to collect and distribute consumer funds obtained in connection with their fraudulent scheme&period;<&sol;p>&NewLine;<p>In or about May 2015&comma; Axact was shut down by Pakistani law enforcement&comma; and certain individuals associated with Axact were prosecuted in Pakistan&period;  Nevertheless&comma; after May 2015&comma; HAMID resumed his fraudulent business of selling fake diplomas to consumers in the United States for upfront fees based upon false and fraudulent representations&period;  Most recently&comma; HAMID traveled to the United States in order to open a bank account that he has used to collect money from consumers he defrauded&period;<&sol;p>&NewLine;<hr &sol;>&NewLine;<p>HAMID&comma; 30&comma; of Karachi&comma; Pakistan&comma; is charged with one count of conspiracy to commit wire fraud and two counts of wire fraud&comma; each of which carries a maximum sentence of 20 years in prison&semi; and one count of aggravated identity theft&comma; which carries a mandatory minimum sentence of two years in prison&period;  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only&comma; as any sentencing of the defendant will be determined by the judge&period;<&sol;p>&NewLine;<p>Mr&period; Bharara praised the investigative work of the FBI and Postal Inspection Service&period;  Mr&period; Bharara noted that the investigation remains ongoing&period;<&sol;p>&NewLine;<p>If you believe you were a victim of this crime&comma; including a victim entitled to restitution&comma; and you wish to provide information to law enforcement and&sol;or receive notice of future developments in the case or additional information&comma; please contact the Victim&sol;Witness Unit at the United States Attorney’s Office for the Southern District of New York&comma; at &lpar;866&rpar; 874-8900&period;  For additional information&comma; go to <a href&equals;"http&colon;&sol;&sol;www&period;usdoj&period;gov&sol;usao&sol;nys&sol;victimwitness&period;html"><u>http&colon;&sol;&sol;www&period;usdoj&period;gov&sol;usao&sol;nys&sol;victimwitness&period;html<&sol;u><&sol;a>&period;<&sol;p>&NewLine;<p>The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit&period;  Assistant United States Attorneys Edward A&period; Imperatore and Noah D&period; Solowiejczyk are in charge of the prosecution&period;<&sol;p>&NewLine;<p>The charges contained in the Complaint are merely accusations&comma; and the defendant is presumed innocent unless and until proven guilty&period;<&sol;p>&NewLine;<p><a href&equals;"https&colon;&sol;&sol;www&period;justice&period;gov&sol;usao-sdny&sol;pr&sol;manhattan-us-attorney-charges-executive-axact-140-million-diploma-mill-scam">Original PressReleases&&num;8230&semi; <&sol;a><&sol;p>&NewLine;

Financial Fraud