A member of a Spokane, Washington–based diploma mill syndicate who bribed foreign officials to obtain accreditation of phony schools escaped prison in return for his cooperation with prosecutors.
According to reports, Richard John Novak, 58, who pleaded guilty in 2006 to one count of violating the Foreign Corrupt Practices Act and another count of conspiring to violate the FCPA and commit wire and mail fraud, was placed on three years probation and ordered to perform 300 hours of community service. He had faced up to ten years in prison. Two other members of the syndicate were sentenced with Novak to probation for conspiracy to commit wire and mail fraud.
Other gang members had already been jailed on non-FCPA charges. Steven Karl Randock, Sr., 69, and his wife, Dixie Ellen Randock, were each sentenced to 36 months in prison followed by 3 years of court supervision; Dixie Randock’s daughter, Heidi Kae Lorhan, was sentenced to 12 months and one day in prison followed by 2 years of court supervision; and Roberta Markishtum was sentenced to 4 months in prison followed by 1 year of court supervision. They had pleaded guilty to charges of conspiracy to commit wire and mail fraud and money laundering.
From 1999 to 2005, the group collected as much as $8 million selling fraudulent academic credentials to over nine thousand individuals located in the United States and elsewhere, the Justice Department said. According to earlier reports, at least 135 U.S. federal employees — including a White House staff member and National Security Agency employees — bought bogus college degrees through the gang. The government refused to publicly name any federal employees holding phony degrees.
In his plea agreement, Novak admitted paying more than $43,000 to several Liberian government officials to obtain accreditation from Liberia for Saint Regis University, Robertstown University, and James Monroe University. The bribes were also meant to induce Liberian officials to issue letters and other documents to third parties falsely representing that Saint Regis University was properly accredited by Liberia. According to his plea agreement, between October 2002 and September 2004, more than $19,000 was wired from an account in the State of Washington controlled by Dixie and Steven Randock to a bank account in Maryland in the name of the Liberian Consul. Novak was paid $60,000 for helping the Randocks deal with the foreign government officials.
The Secret Service filmed a Liberian diplomat taking a bribe from Novak in a hotel room in Washington, D.C. Novak also made cash payments to diplomats in Liberia and Ghana. Of the 6,000 phony college degrees sold by the gang from schools accredited by Liberia, about 40 percent were bought by foreign residents seeking entry into the United States, the government said.
The Seattle Times reported in 2006 that Novak attended Spokane Community College for one year. He left without a degree and then worked as a car salesman. But after joining the Randocks’ operation in 2002, he was shown on the Saint Regis University web site as holding doctorates in international business, educational administration and psychology.
The gang created more than 100 phony schools such as: Saint Regis University; James Monroe University; Robertstown University; Holy Acclaim University; Ameritech University; Fort Young University; Pan America University; All Saints American University; American Capital University; Blackstone University; Capital America University; Hampton Bay University; Hartland University; Intech University; Nation State University; New Manhattan University and Graduate Institute; North United University; Port Rhode University; St. Lourdes University; Saint Renoir University; Stanley State Graduate University; Van Ives University; West American University; International MBA Institute; Apollo Certification Institute; James Monroe High School; Liberty Academy Preparatory High School; Trinity Christian High School; Mission College Preparatory High School; and Bradford Academy College Preparatory High School.
The syndicate also sold counterfeit diplomas and academic products purporting to be from legitimate academic institutions, such as the University of Maryland, George Washington University, Missouri University, and Texas A&M University.
View the DOJ’s August 05, 2008 release here.