|Feds investigate diploma mills: Sites in West raided; records that name local man are sought, |
Steve Orr, Rochester, New York Democrat and Chronicle, August 17, 2005.
Federal authorities are conducting a criminal probe of suspected "diploma mills" that could involve bogus accreditation supplied by a Liberian government official — and a Rochester-area man appears to be at least tangentially involved in the case.
The U.S. Secret Service raided homes and businesses in the western United States late last week in connection with the probe, which is focused on St. Regis University and several related online colleges that claim accreditation from a Liberian government agency. An affidavit filed in court by a Secret Service agent said the colleges sell degrees to "students" and require little or no coursework.
The affidavit said an agent obtained four bogus degrees from the online institutions while working undercover earlier this year.
The operators of the colleges, which appear to be based in Spokane, Wash., have reaped at least several million dollars from the scheme, the affidavit said.
Richard J. Hoyer, an Irondequoit resident with a history of involvement in online colleges, is identified in the affidavit as having been connected to St. Regis and the Liberian accreditation gambit in the past.
Agents listed records or other documents bearing Hoyer's name as among the items they were seeking in their searches.
In stories published in 2003, the Democrat and Chronicle reported that Hoyer had drawn scrutiny from education regulators in at least three states. New York ordered him to cease operating an online homeland-security college in October 2003 because it had no state authorization.
The newspaper also reported that Hoyer was involved with an entity that was arranging accreditation in the name of the African nation of Liberia. Accreditation, if bestowed by a legitimate entity, serves as proof that a college or university program has met strict standards.
The Secret Service affidavit said an agent posed as a would-be operator of an online university and was introduced to Abdulah K. Dunbar, a Liberian Embassy official, at a July 7 meeting that was secretly videotaped by other agents. The affidavit said Dunbar promised he could arrange for Liberian accreditation for the university in return for a $5,000 payment.
Hoyer did not respond to an e-mail seeking comment Tuesday. In an e-mail he sent to a Democrat and Chronicle reporter in December on another matter, he disavowed any past or present connection with St. Regis...
Federal agents execute search warrants in Spokane, Idaho, and Arizona.
As part of an ongoing investigation, federal, state, and local investigators carrying search warrants entered seven private and commercial addresses in Washington State, Idaho, and Arizona on Thursday, August 11. Agents removed documents and computer hardware for further inspection.
The investigation focuses on businesses that are alleged to sell university degrees.
Agencies participating in the investigation include the U.S. Secret Service, the U.S. Internal Revenue Service, the office of the U.S. Attorney for the Eastern District of Washington, the U.S. Immigration Customs Enforcement Bureau, the U.S. Postal Inspection Service, the Office of the Attorney General of Washington State, and the Spokane, Washington Police Department. The Secret Service is the lead agency in the investigation.
Searches were conducted at the following addresses:
14525 N. Newport Hwy, Mead, WA
601 E. Seltice Way B-8, Post Falls, ID
office of Northwest Business Stamp, Inc.
5210 N. Market Street, Spokane WA
residence of Dixie Randock and Steve Randock, Sr.
3127 E. River Glen Drive, Colbert, WA
residence of Heidi Lorhan and Douglas Lorhan
14308 E. 22nd Ave., Veradale, WA
residence of Richard Novak
14628 North 90th Dr., Peoria, AZ
residence of Amy Hensley
8015 E. Baldwin, Spokane, WA
Feds Crack Down On Alleged Diploma Mills, KXLY News (Spokane, Washington), August 11, 2005. The web page currently includes a link to a video of the broadcast story.
Agents visit diploma mill sites, Bill Morlin, Spokane Spokesman-Review, August 12, 2005.
A task force of federal and state agents, investigating one of the biggest diploma mill schemes in the United States, served search warrants Thursday in Spokane, Post Falls and Arizona.
The search warrants are part of an eight-month investigation that is building a criminal case against Dixie and Steve Randock of Colbert, who are believed to be the masterminds behind the bogus college degree operation.
Hundreds of thousands of dollars in profit from the scheme are being laundered through domestic and off-shore bank accounts, according to documents filed Thursday in U.S. District Court.
Those documents say the Randocks and others are under investigation for possible mail and wire fraud violations and money laundering...
Bogus degrees offer way to U.S., Bill Morlin, Spokane Spokesman-Review, August 16, 2005.
Foreign nationals, including potential terrorists, could legally gain entry into the United States with fraudulent degrees purchased from Spokane-based diploma mills, documents made public Monday reveal.
Half the "degrees" sold by Saint Regis University and other diploma mills were sold to overseas purchasers, a majority of which were for "students" from Saudi Arabia, the documents say...
The documents don't give a specific number of degrees sold overseas, but they disclose the operation based in Spokane and North Idaho has "made millions" in the last few years.
Offshore bank accounts are being used as part of the alleged money-laundering operation directed by Dixie and Steve Randocks, the documents allege.
An eight-month task force investigation, outlined in the documents, revealed that a top-ranking Liberian diplomat based in Washington, D.C., was soliciting cash bribes from the Randocks and their associates based in Spokane, Post Falls and Arizona.
The Liberian Embassy official demanded the bribes in exchange for lining up "accreditation" for Saint Regis University and other diploma mills and for arranging payments of $50 to $100 a month to Liberian educators who would pose as "faculty members" for the online universities.
As part of the investigation, the demands for the "cash payments" were secretly videotaped during a July 5 meeting at the Mayflower Hotel in Washington, D.C., where an undercover U.S. Secret Service agent from Spokane attempted to buy an online diploma mill for $100,000.
Abdullah Dunbar, the deputy chief of the Liberian Embassy in Washington, D.C., demanded $5,000 and an expense-paid trip to his homeland to finalize accreditation for the online university, the court documents allege.
Asked if any laws were being violated by making such a demand, Dunbar responded, "Nah, I'm a diplomat," according to the court documents. If he isn't charged, U.S. authorities are expected to seek Dunbar's deportation, according to a source familiar with the case.
There have been no arrests, and no criminal charges have been filed.
But a 141-page affidavit, filed Monday in U.S. District Court, makes it clear that the task force is on the verge of seeking federal charges for conspiracy, wire and mail fraud, money laundering, bankruptcy fraud, income tax evasion and engaging in "prohibited foreign trade practices."...
(The Spokesman-Review has given permission for the full text of the article to be posted here.)