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FIA raids Axact offices, takes records and employees into custody

FIA raids Axact offices, takes records and employees into custody

ISLAMABAD: A team of the Federal Investigation Agency's cyber crime unit entered local IT company Axact's Islamabad and Karachi offices on Tuesday and collected manuals, records and computers as evidence in the ongoing investigation of a global fake degrees scam.

TV reports quoted FIA Deputy Director Tahir Tanveer as saying that the Axact offices in twin cities of Islamabad and Rawalpindi have been sealed and that around 22 employees of the IT company were taken into custody by the Islamabad investigating team.

Kamran Ataullah, a deputy director at the Federal Investigation Agency in Karachi, said the investigation would not be limited to the contents of the Times article.

“We’ve issued a letter to them, and we’re looking for details of their database, employees, what websites and equipment they’re using,” he said while talking to NYT.

Meanwhile, a team of the FIA's corporate crime unit also visited Axact’s Karachi offices and questioned their employees, DawnNews quoted FIA sources as saying.

No one has been arrested or taken into custody at the Karachi office as yet, they added. Employees, particularly IT employees, were not allowed to leave the office premises during the investigations.

FIA officers swooped on the Karachi headquarters of the company, seizing equipment and records and expelling employees from the building, a member of the raiding party told on the condition of anonymity.

US State Department, while reacting to allegations levelled against Axact in a New York Times article, said it had made no agreement on document attestation with the said company, DawnNews reported.

The state department said it keeps providing relevant information on its website to protect citizens from scams.

It further added that investigations on the company’s practices are currently underway in Pakistan.

Earlier, action against Axact kicked off after Federal Interior Minister Chaudhry Nisar Ali Khan ordered an inquiry into a story published by The New York Times that claimed the company was issuing fake degrees as part of a massive, global scam.

An interior ministry spokesman said Nisar had directed the FIA to submit a report after a thorough investigation.

The minister in his directive also said that the FIA was to determine whether the contents of the NYT story were true and whether the company was involved in any illegal business which may bring a "bad name" to Pakistan.

FIA corporate crime circle has issued notice to summon Axact’s chief Shoaib Ahmed Shaikh on Thursday, DawnNews reported.

The officials have also asked the company authorities to present their registration certificate, tax return details and the details of degrees issued so far, it added.

The detailed NYT report titled "Fake Diplomas, Real Cash: Pakistani Company Axact Reaps Millions" and written by New York Times Pakistan bureau chief Declan Walsh outlined how Axact — referred to as a "secretive Pakistani software company" — allegedly earned millions of dollars from scams involving fake degrees, non-existent online universities and manipulation of customers.

According to the report, Axact created a series of fake websites involving “professors” and students who it said were in fact paid actors.

An FIA official who did not wish to be named said that the allegations raised by the newspaper if proven true would be punishable by seven years in prison under Pakistan's Electronic Transaction Ordinance.

The NYT report was also referred to the concerned house committee of the Senate by Chairman Senate Raza Rabbani for investigation.

"A story has been published in the newspapers attributed to Pakistan, and Shoaib Ahmad Shaikh of BOL network has every right to clarify," opposition leader in Senate, Aitzaz Ahsan, said.

Aitzaz added that this was a serious matter because a Pakistani company had allegedly been issuing fake degrees, according to newspaper reports.

"What's the reason that we Pakistanis are such experts in forgery? The matter has to go to the house committee," Aitzaz said.

The Senate chairman, after hearing the matter, observed that the issue raised was of importance. He referred the matter to the concerned house committee and ordered an investigation.

In the statement on its website, Axact did not directly respond to the allegations but instead accused domestic media rivals of colluding with the New York Times to plant a slanderous story in order to harm its business interests.

The response also alleged that Declan Walsh had devised a "one-sided story" without taking any input from the company.

Axact uploaded a detailed legal notice sent to NYT. The company also sent a legal notice to local blogging website Pak Tea House, which caused a buzz on social media. NYT also ran a short report on the Pak Tea House legal notice titled, "Axact, Fake Diploma Company, Threatens Pakistani Bloggers Who Laugh at Its Expense".

Axact and its CEO, Shoaib Ahmad Shaikh, did not respond to requests from for comment

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