Fake degrees: Software tycoon arrested as police investigate credentials from 'Barkley' and 'Columbiana'

Pakistan had sought the help of the FBI and Interpol in the case

Shoaib Ahmed Shaikh, centre, was arrested in Karachi (Reuters)

Update (January 4 2024): legal representatives of Axact, Shoaib Ahmed Shaikh and Bol Network contacted The Independent to say that Shoaib Ahmed Shaikh has been acquitted by both the Sindh High Court and Islamabad High Court of all charges. They say that there are no pending cases against him.

Update (January 13 2023): legal representatives of Axact, Shoaib Ahmed Shaikh and Bol Network contacted The Independent to say that the investigation conducted by the federal authorities and agencies of Pakistan concluded that all operations and businesses of Mr Shaikh and his companies are legitimate and operated within the ambit of the governing laws of the State of Pakistan and are in compliance with the applicable laws, statutory rules and regulations.

The chief executive of one of Pakistan’s best known software and media companies, Axact, was arrested and remanded in custody amid charges of peddling degrees from fictitious universities with names meant to evoke some of America’s top academic institutions, like “Columbiana” and “Barkley”.

After an investigation sparked by a report earlier this month in the New York Times into Axact’s alleged diploma-mill business, police charged the CEO, Shoaib Ahmed Shaikh and at least six other executives with crimes ranging from fraud, forgery, illegal electronic transfers to money laundering.

Because customers of the fake credentials were said to be from multiple countries, including the United States, Pakistan had sought the help of the FBI and Interpol in the case. Additionally, most of the fantasy centres of learning were purported to be in the US. American mail boxes and bank accounts were also used. Officials allege that the network generated millions of dollars annually for Axact.

The arrests came when Mr Shaikh led police to a room in a company facility in Karachi apparently stuffed with some of the phoney diplomas as well as forged student identity cards and other paraphernalia associated with the scheme.

“There were hundreds of thousands of documents there,” said Shahid Hayat, head of the local Federal Investigation Agency. “We have enough evidence to proceed – we have forensic evidence.” After a brief court appearance yesterday, Mr Shaikh was ordered to be held for seven days while the investigation is pursued.

The scandal has broken at a highly inopportune moment for Axact which was poised to launch a new broadcast network in Pakistan. Branded as Bol, it had attracted some of the country’s top journalists. Now, in the wake of the diploma mill revelations, many are running out the door.

Investigators have described an elaborate operation which included the hiring of actors to pose as faculty and students in promotional videos for non-existent universities that also had names like Cambell State, Oxdell, Bay View and Nixon.

According to the original New York Times report, clients from places as far apart as Britain, the US and the United Arab Emirates had been duped into paying thousands to hundreds of thousands of dollars for degrees.

Meanwhile Axact employees reportedly placed stories about the universities on citizen-generated news sites to reinforce the illusion that they actually existed.