Inside Out of Axact Case!

Guilty or innocent — only time will tell — but its a shame that New York Times had to do the story about a Pakistani company when we have hundreds of media houses with-in the country to report on various matters including Information Technology. I am such a reporter who works on the Pakistani ICT sector and I accept my incompetency and inability for not knowing the whole matter until I saw the NYT report.

Its not that NYT can’t or shouldn’t have done the story, but we — local publishers — should have known about it and highlighted this first. Yes, I have heard the stories against Axact in the past silenced through court orders but then again, either those stories were weak or our publishers weren’t mature enough to deal with such situations.

So yes, NYT had to come to the rescue and do a story that Pakistanis couldn’t and it’s a shame.

Weak Regulating Bodies

After media, its the concerned regulating bodies (FBR, SECP, PASHA, PSEB, FIA) that are to be blamed. They don’t have any measures in place that could determine such misdeeds automatically and in real-time, way before than such things make it to the press.

Why is it that our cousins or friends in USA can’t accept even 100 dollars in their account that they can’t prove? Why is it that PayPal accounts of our friends in USA are blocked because they get too much funds without justifying the source of revenues?

Why was FBR unable to figure out the source of revenues of a software firm? Why didn’t they ask the company about the services they provide and the profits they make?

Either they are incompetent or they were involved in the crime. There’s no third option. They should be questioned to make sure that we straighten our acts.

FIA’s Raids on Axact Are Alarming

Story against Axact appears in NYT and government comes in action with-in 24 hours, which is a positive indication but Federal Investigation Agency raiding an office without a warrant is very alarming. My sources in media confirmed that FIA had orders for investigation from Interior Minister and that’s it. FIA may have warrants by now, but they didn’t have anything yesterday.

It is concerning to many in IT industry that even a hint of a damning press report can bring along FIA officers armed with hi-fi rifles and what not.

I am not arguing for or against Axact. That is for the investigators and courts to prove. My only point is that in a democracy, everyone has a right to due process. You can’t be prosecuted based on a press report. There has to be a framework which can be used to investigate such claims and if need be, raid offices, confiscate equipment and arrest employees.

I have spoken with multiple lawyers, and no one gave me a legal explanation for the raids. But they said that FIA people do this all the time.

Awab Alvi, a PTI member and a fellow blogger, said that waiting for FIA to obtain warrants from courts is like granting Axact more time and essentially, a chance to wipe out the evidence which can be fatal for the investigation. Okay, fine, that’s a valid point — but does it mean that one can bypass the law? The answer is NO.

This also means that your laws are flawed — if they even exist at all — and they needs correction. Make a law that could speed up the process of getting warrants, or maybe a law that wouldn’t require warrants at all and then raid people instantly and I won’t question you. But as long as warrants are mandatory for raiding anyone, they should be obtained ahead of any action.

Axact is an Individual Company, not a Country, not Pakistan

Guilty or innocent, let’s not make this case about Pakistan. Its about an individual company that had offices in Pakistan, and in other countries.

I see people trying to spin it as a nationalist issue and saying it’s a ‘conspiracy’ but that’s all hilariously pathetic. Axact is not a national treasure, it’s a company run for profit and if there is any misappropriation, then a case should be registered against the company and they should be prosecuted as a usual business.

Shoaib Sheikh, CEO Axact, has welcomed the investigation by saying that he supports inquiry, which is a positive thing. But at the same time, those who think that authorities should spare Axact because it will bring bad name to Pakistan, then it won’t.

Axact is not anywhere near to Satyam of India — in terms of size, revenues etc. — still it was investigated when reports about manipulation of its accounts surfaced. Yes, Indian repute was put at stake but it didn’t stop Indian authorities to prosecute and investigate a business firm and it didn’t harm Indian IT industry.

Axact Case, its Investigation and Media Reporting is Motivated 

Accept it or not, GEO, Express, ARY, Dunya or any other media house would benefit if Axact is proven guilty. Media houses have vested interest in reporting on the matter and this is probably why no one is raising questions over FIA’s illegal raid, inability of FBR for not tracing Axact’s activities in advance.

Again, I am not against investigating Axact but biased reporting can influence the outcome of the investigation and it’s alarming.

Its a bad precedent. Media houses are pretty much rubbing their hands in glee at the chance to take a competitor out of the game and journalistic integrity, which was already in short supply, has all but disappeared in this case.

Yasir Jamshaid has Committed a Crime

I haven’t seen Axact’s agreement with its employees but I am certain that company doesn’t allow its employees to share internal data in public.

Yasir Jamshaid, the whistle blower who apparently tipped NYT, has posted Axact’s internal data on his Facebook and thus breached his non disclosure agreement.

As we know, whistle-blowers get protection in various countries, but its not same here. Only KPK government offers protections for whistle-blowers and allows anyone to breach NDAs in good faith when there’s serious threat to health, safety or the environment or there is a crime of any kind involved.

Pakistan is currently working on a whistle-blowers’ law but as of now, there’s no such protection offered to whistle-blowers for breaching NDAs.

Axact’s Response on Matter Didn’t Address the Real Issues

Axact is widely circulating its response, mainly its CEO’s speech that aims to respond NYT’s report. Shoaib Sheikh, who seems to be a good speaker, did well by playing Pakistan card and shifting the blame to rival media houses by brining in motivation factor, but he failed in addressing the real allegations.

While he rightly said that its NYT that has to prove the claims, but he could take the community into trust by either telling us about their clients that make them millions of dollars in revenues, or some insight about the products that they sell.

He could be more rational by explaining his source of revenues instead of just bashing rival groups.

Playing on the emotions and spinning it as a conspiracy does not make him or the company look less guilty.

Collecting Evidence Against Axact isn’t Hard

Since courts haven’t been moved against Axact yet, we can write about the case itself. It is no rocket science to find out if Axact was involved in fake degrees or not.

Some simple tacert commands can determine you that all reported bogus universities’ and Axact and BOL’s website reside with-in same data center.

Even worse, majority of these websites were hosted on same server back in 2013, one can find out through checking IP history of these websites. Then all these websites were moved from one hosting service to another — in a bulk — all together hinting that either Axact manages these bogus websites directly or their clients own these websites.

While its not black and white proof against Axact, but webmasters and those in hosting business know it well that Exact, Bol Network and these bogus universities’ websites residing with-in same host can’t just be a coincidence.

One way or the other, creating a link here would be a fifth grader’s play. So determining if Axact is guilty or not isn’t going to be a tough job at all.

Conclusion:

The Axact case will have important ramifications, there is no doubt about that. In our opinion, there is too much smoke for there not to be a fire.

If the company is found guilty, huge question marks will be raised. For independent publishers like us, for the media houses that have budgets in the millions, for investigative journalists and mostly, for government authorities who were by all indication clueless.

And above all, those Pakistanis who take the short routes to make quick bucks. You must stop and think of legitimate, halal ways of earning money. Or we will keep coming across similar cases in future too.

Tech reporter with over 10 years of experience, founder of ProPakistani.PK


  • Right on spot there.
    PS. From what info I got from some of my contacts in the industry, hostinglance is just a front end of some other company. No one has any info at all about them which is odd when you are in hosting industry.
    They do not provide actual hosting services. Most likely (can’t be 100%) just a name Axact selected to hide behind.

  • Sadly the respect for humanity is destroyed publicly through media and FIA. No one thought what it would cost to the families and children of those employees who were shown being arrested on TV.

      • Its not necessary that everyone there is involved in selling fake degrees. Some might be just software Engineers. Still there is no proof that Axact is involved in that scam. No one deserves to be humiliated publicly on bases of just allegations. That’s how things like these are handled in respectful nations but here we decide someone is criminal and keep pushing him until he becomes one.

      • what a bull crap comment is that, so lets see if you work in a bank and the bank owner do some big fraud, by your STUPID LOGIC, its ok for you to get arrested?

  • I was thinking today that there are hundreds of colleges in United Kingdom who are in D List. But still they are getting huge income from Pakistan through local agents through fraudulent way. Why our education sector is not raising voices against such blacksheep who even don’t have any building in United Kingdom or other foreign countries. Even Government officials of that European countries are silent because they are helping them boosting their economy.

    Why not NYTimes speaks against them till today. NYTimes shown pure yellow journalism in this article. If NYTimes is blaming a Pakistani firm with useless and Clueless material than he should also have to prove it. As in Law burden of prove is on the party who blames someone for any misconduct. In other words it lies in definition of Defamation “تہمت”.

    It is good that government is conducting an inquiry and hope so that it will be unbiased and reflects truth. And if it goes in favor of Axact. Than what action should be taken against blamers who are not present in Pakistan. Should government take legal action against all the local publishers and media houses??? That is a big question mark.

    • CEO of axat should be telling how they generate revenue instead of telling that he owned a group worth of 20 million dollars, if i m not wrong.

      Bhai face it, don’t start blame game, Defend the allegations.

    • Are you a troll or a real person? Because your comment made no sense at all. You are placing NYT report in the category of “Tohmat”? The report has named Axact, has named websites, has provided cyber links to build up its case and even ex-Axactians came out to speak against Axact.

      Before you go on harping about Tohmat bandwagon, can you tell the world what Axact does? What’s its business?

      And NYT report is based on its Pakistan representative investigative journalist … THE ONLY ONE that writes investigative stories about Pakistan. Any false story, from his behalf, will close his career as a journalist so he isn’t someone to put his and NYT’s reputation at stake over a false story.

      Lastly, where did Europe come from? Have you EVER read NYT’s Europe column? I bet you have no frikkin idea, otherwise you wouldn’t even have thought to bring this up.

      Kindly go through TODAY’S NYT about Europe and see how indepth reporting is done about the continent at the newspaper:

      http://www.nytimes.com/pages/world/europe/index.html

      Have fun and stop trolling.

  • i am still thinking if Axact was running like 360 fake institutions all around the globe, how come they escaped regulations in USA, Europe and Arab states?

    • those institutions did not even exist in the first place, there was no physical presence, registration etc. Merely creating a fake university website does not require adherence to any regulations

    • No they didn’t ? How can you say so ? as Amir Atta has rightly quoted Satyam India was values in Billions of dollars and yet they prosecuted it and it didn’t hurt their industry. they are still thriving and growing

      • Satyam scandal did not hurt India’s industry because it was a billion dollar enterprise (even without accounts manipulation) in a multi-billion dollar well-established and reputable economy. And the impact was more relevant on the investors rather than clients and services.

  • What was the point of writing this article ? you have taken no stand just repeated what we already know
    Great

  • Kudus Aamir for taking a very neutral and firm stance here. I completely agree that it should’ve been some of us who knew some aspects of what was happening there take a stand against them instead of relying on NYT, but we can’t fault them for taking this up.

    It seems like most of the financial damage done through this alleged scam has been to residents of other countries including the US, so they do have the right to raise the issue.

  • How Yasir Jamshaid has Committed a Crime?

    Signing NDA doesn’t mean that the company can do every type crime and their employees have to keep that secret.

    I think you must change that statement @Aamir

    • NDA specifically means you cannot disclose proprietary company information no matter what happens. Snowden spoke out and everybody agreed it was the right thing to do however, he breached his NDA and now has to take asylum in other countries. Morality doesn’t factor into a non disclosure agreement.

  • Just wondering why one will buy a fake degree intentionally?

    This remind me a joke about Jumshaid Dusti that “I have not submitted fake degree but the degree given to me was fake!”

  • Dear Aamir

    Yasir Jamshaid might not have committed a crime. Your approach is decisive in this regard which shouldn’t be. I am not a Pakistani law student but I know that many countries allow whistle blowers to disclose internal information if it is sure that organization is involved in public fraud or bad repute for the country.

  • There are many scams regarding Ad posting. Online jobs and others which are being operated by US based groups and no one talk about It…

  • The company still had 1 day after NYT article to wipe off data and erase evidence, I’m sure being the largest IT company in Pakistan (their claim, not mine) they had already done it

  • The company might have violated tax laws, and company regulations, but selling degrees is not prohibited by any law :D
    However, misrepresenting US state dept. is a crime I believe. US authorities will come into action.
    Its unfortunate that a tabloid like Newyork Times got the chance to spit once more on he name “Pakistan” while we are still not ready to take an exemplary action.
    Who told Sheikh to create Bol media and come to the limelight? What an idior. He did not learn anything from fraudsters of Paasban IT of Faisalabad, who still roam free. Ideally, they should be investigated next. I hope PP can do some investigation about them, but really, its not worth the risk. People will money and contacts are not noble saints.

  • it is really interesting to read this article even though I don’t generally follow stories. But by reading this I am more confused than before because you are neither siding with Axact nor going against it. like most of us you are also clueless.

    second I am amazed how an article in NYT can totally screw up a companies repute. I haven’t read the article but I am assuming they have given ample “proof” to start such an operation.

    third… i am sure we all get spam mails of a orphan whose parents did in an accident and want to share millions of dollars with us or an auditor who had discovered millions… had similar action been taken against such people or should we blame Axact for it too?? After all we are a nation who welcomes all to walk all over us.

        • We were the first ones in Pakistan to carry NYT report, despite their reputation of sending notices to even those who comment in articles :-)

          • But your all posts of Axact showing that you are afraid from them. Tum clearly baat kiun nhi kar rahe jaise tum ne baki compaines ki udher ki rakhi thin. Darr gae ho hahahahhahah

      • Brother, the biggest mistake a scammer makes is that he doesn’t know how to write a correct sentence. If you want to check the correctness of such messages just look at the grammatical structure if you find a single mistake then it means it’s fake. The spelling of customer and one word in English where the rest of it in Urdu show the stupidity of the scammer. The same goes for the Benazir Income bogus messages.

        • After reading “costomer”, I came to know what you say. But I wana say, with due respect, that why our FIA, FBR, govt are silent about these sms scammers, call centers, GMI, Tiens and many more etc.

          • Interestingly, perhaps, FIA offices etc also get this message but they don’t take an action. According to my point of view, there is no law against scammers. Once the law is made then we will see a tremendous change.

  • They sell Pornographic videos and fake degrees that I’m very well aware off. I got links there who told me around a year ago about there pathetic work. They should be banned and brought to justice.

  • Bro. Still it is a controversy. Point of ponder is that it seems a propaganda that all media mafias are against axact. I’m not supporting Axact or Bol in any sense. If they have really done it and given bad name to country. Strict Action should be taken against the teams who is found guilty of alleges being represented by NYTimes.
    I’m against those Booking Media Mafia who works on agenda of supporting Yellow Journalism. For instance the case of Geo Hamid Meer….. When a planted program was being run on Dunya News against than Ex-Justice Iftikhar Ch. then CJP.
    We have big black sheep in our Cricket Team too. When Mohammad Amir give bad name to Pakistan and now we are supporting that guy again.
    What is the credibility of NYTimes article. Did NYTimes always speak truth or they reflect real image. If the allegations being not proven against axact than what. Did you file case or sue NYTimes for presenting malicious story. I don’t think so. Did you can bring this Media Mafia to courts???

    • Clearly you have no sense of integrity. Fraud and deception do not matter to you as long as the people perpetrating it are related to you by ethnicity or nationality.

  • I mostly agree with you, but you are dead wrong when you say “Yasir Jamshaid has committed a crime” and headline it. In principle, nondisclosure agreements do not and should not protect criminal activity. The only danger is if the accused is found innocent, or the allegations were false, in which case the accuser could be charged with libel. That is why there are whistleblower laws.

  • All the domain and Hosting services are provided by network solutions

    FiA Must contact network solution to find out who register these domains

  • This investigative article is a Must Read when it comes to this issue. And FIA’s current sudden steadiness in this matter.

  • Your report is appalling. 1) Obviously FIA needs to move fast to capture evidence. No reason to bring up that it has failed in many other cases. 2) Are you saying that a fraud company closure will benefit the others? Ofcourse. That is how it is supposed to work and does everywhere in the world. That is one reason to catch them as they are hurting legit businesses 3) Sophisticated frauds happen all around the globe. And successful ones take a bit longer. We do need better over sight, but doesn’t mean you need to bash regulatory bodies. Even the best in the world fall short. 4) Are you saying if you sign an NDA and see crime happening, you shouldn’t expose ?
    I really hope you have another source of income coz reporting isnt for you.

  • Maazrat k sath jo bhe IT Profeesional hai aur aXact k asal kam k baray mai kahay k mai nahi janta wo nunna banay ki koshish kar raha hay. I know this company when it was just a three room office in anum estate building near baloch bridge on 3rd floor and with in ten months they bought three complete floors in same building. it was 2005 month was feb-Mar.

  • I will clarify one item regarding Yasir Jamshaid — The crimes of moral turpitude such as fraud, murder, theft, etc., do not fall under the premise of a “Non-disclosure” agreement. This is why most countries have protection for whistleblowers. ProPakistani should act responsibly and not be quick to pass a guilty verdict before understanding the legality of the matter. Whether a criminal activity was reported to NYT in the capacity of a whistleblower or was Yasir’s act merely a sharing of internal documents for malicious purposes (such as blackmail) is yet to be determined.

  • Hi Aamir,

    You make a good point about due process. Axact may be a horrible company but raiding an office without a warrant is an example of state oppression (even if in this case it’s fairly innocuous). We have once again set a wrong precedent.

  • Incompetency at its Peak. From Govt institutions to Media Houses to Bloggers. I know that Axact is one of the few companies in Pakistan which give respect to its lower staff. BOL altogether changed the perception of media owners.Now they are thinking about their camera man & reporters. We should at least appreciate this. With passage of time everything will be loud n clear.

  • Its all true. Exact is a fraud.They have been practicing a heinous crime. There are so many all over the world doing such frauds but they are caught sooner or later. There was a scam like this in Hong Kong recently. Company closed, all assets confiscated. CEO and other responsible jailed.They have been practicing a heinous crime.My friend studied six years in Waterloo,Canada Earned a degree in 2008, after his parents spent 300,000 Dollars on his education & boarding. He has good job but lately a local remarked at him that ” you guys get degrees for $100 in Pak. Imagine how our fellow country man felt. All this because of such black sheep in our country.

  • I am not an axaction but am following all details on
    Media and interviews of Mr. Shoaib Sheikh CEO,I am very much shocked to see the
    behaviour of our media, ex and prevailing politicians and some so called intellectuals,an article
    comes in some foreign news and every one goes against and have judge axact to
    be guilty before any enquiry or giving fair chance to the accused.I have some
    questions for Media can they please say that the allegations made on foreign
    media are more serious then a few times back a diplomat killed innocent Pakistanis and was
    released/sent back to his country (whole of that country was backing him)where
    was media at that time our mentality is still slavery based and we are very
    much influenced by any article published in NY,London or any western country we
    ourselves our giving negative impact of our country by shouting , let the
    enquiry finish and agencies probe the truth then only make judgement.

    We Pakistanis should stand with our fellow country man
    and request our PM Mr. Nawaz Sharif, Minister of Interior Mr. Ch. Nisar, Chief
    Justice of Pakistan, Army Chief and all politicians,bureucrats ,PEMRA (to stop
    alleging on media until unless proven guilty) and to give AXACT a fair chance
    to clear the allegations as thousands of young people are earning their
    livelihood from it.

  • There was an ARTICLE on MASHABLE too.. I have the link, but somehow these people also got that removed from Mashables.com .. . That was the real head-turner for me! Either Mashable officials were using Axact degrees or they got paid a lot for it lol :-D

  • Finally somebody can observe and report the complete and unbiased picture. It was a long awaited, non-politically motivated breath of fresh air.
    Thank you and keep up the good work, dont follow the same self motivated drama our media, regularing authorities and businesses have become please.

  • nothing but indian investment to move business to banglore. and it worked. The raw agents like chaudray nisar did rest.

  • I wrote a few columns in the dailypakistan.com.pk in favour of Axact. I knew there is nothing in these cases but fabricated by the so-called big media houses whole are stingi to pay their employees. If money laundering charges are dropped fake degrees is just a hoax. In USA there are hundreds thousands virtual organization offering this kind of degrees. Fake means if Axact claim that this degree is issued by Punjab university or Harvard university. Here it is not the case Axact’s own virtual univesities offering degrees and it is the buyer that has to decide what he wants and what he gets.
    Axact media venture will be a game changer. I hope Mr. Shaikh will be careful in selecting people for Bol. Not those who enthusiastic to come but in problem time fled away. People should be competent and loyal stead fast and they should stand with Mr. Shaikh in good or bad in hot or cold. Thy should support him in rainy days.
    Ashraf Quraishi.

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