A U.S. district court in Florida has halted business operations of Diversified Educational Resources LLC and Motivational Management & Development Services Ltd. after the companies allegedly grossed more than $11 million from selling fake high school diplomas online.
The companies since 2006 have used multiple names, including "Jefferson High School Online" and "Enterprise High School Online" to market and sell the phony diplomas, according to a complaint by the Federal Trade Commission. Their websites claimed that by enrolling in the defendants' programs, consumers could obtain accredited high school diplomas and use them to enroll in college, join the military and apply for jobs.
The defendants charged students between $200 and $300 for a diploma, and a preliminary review of bank records suggests that defendants have taken in $11.1 million since January 2009.
The FTC's lawsuit seeks a permanent injunction to stop the scheme and return the money to consumers.
The complaint alleges that the defendants violated the FTC Act by misrepresenting that the diplomas were valid high school equivalency credentials and that the online schools were accredited. The FTC says the defendants fabricated an accrediting body to give legitimacy to the diploma mill operation.
"A high school diploma is necessary for entry into college, the military, and many jobs," said Jessica Rich, director of the FTCs Bureau of Consumer Protection. "These defendants took students' money but only provided a worthless credential that won't help their future plans."
The list of company defendants in the case include: Diversified Education Resources, Motivational Management & Development Services and IDM Services LLC. Also named as defendants are: Maria T. Garcia, principal owner and manager of the firms, and Alexander Wolfram, principal owner of the firms.