DEGREES OF SUSPICIONIn this report:
Article: Inside the Multimillion-Dollar World of Diploma Mills
Article: Professors With Bogus Degrees
Article: What’s a Diploma Mill?
Multimedia: An interactive graphic showing the cozy connections between the operators of unaccredited colleges (Requires Flash, available free from Macromedia.)
Article: A One-Woman University
Article: The University of Spam
Text: Excerpts from a telemarketing script used by one diploma mill
Article: Fighting FakeryBy THOMAS BARTLETT and SCOTT SMALLWOOD
An accordion folder packed with documents is all that’s left of Columbia State University. Inside are slick brochures (“Earn a college degree in 27 days”), a catalog that lists majors like computer science and hospital administration, and advertisements claiming that Columbia State has the same accreditation as Harvard and Yale. Among the papers is a stack of canceled checks held together by a green rubber band. The checks, dated from December 1997 to June 1998, are made out from the university to its owner, most for exactly $50,000. Their total comes to $3.5-million.
In its heyday, Columbia State was the boldest and perhaps most profitable diploma mill in the United States. By one estimate it earned more than $70-million during the 1990s. A former employee says the university often made a million dollars per month selling degrees by placing advertisements in USA Today and other newspapers. With only a handful of employees working in rented office space, its costs were low and profits high.
The catalog says the university’s founder is Austen Henry Layard. That’s not true: Austen Henry Layard, a British archaeologist, died a century before Columbia State opened. In fact, nearly everything about Columbia State is a lie. The bogus testimonials from students, the nonexistent curriculum -- even the photograph on the cover of the catalog is deceptive. The lovely Gothic building pictured is the Lyndhurst mansion, in Tarrytown, N.Y., and has nothing to do with Columbia State.
The creator of this fraudulent seat of learning sometimes goes by the name Doctor Dante. On other occasions he calls himself Phil Harris or Earl Clevenger or even Bonnie Ritchie. Over the years he has used at least 40 aliases, changing identity and career and hair color so many times it’s hard to believe he is only one man.
His real name, according to authorities, is Ronald Pellar. He is a 74-year-old great-grandfather and former nightclub hypnotist who is either a “lovable scoundrel” or a “truly evil man,” depending on whom you believe. He has sold bachelor’s, master’s, and doctoral degrees to thousands of customers, many of whom -- according to searches of the Internet and résumé databanks -- continue to use their credentials.
At the moment, Mr. Pellar is in a prison cell in Los Angeles, serving an eight-month sentence for mail fraud related to Columbia State. He is among the very few diploma-mill operators who have spent time in jail for running fraudulent institutions. And it was another scheme, not his multimillion-dollar degree business, that first attracted the attention of federal authorities. If not for that, Columbia State might still be in business, and Mr. Pellar might still be living on his $1.5-million yacht off the coast of Mexico.
From Hypnosis to Hit Man
He didn’t start out as the owner of a fake university. For decades he billed himself as Doctor Dante, “the world’s most famous and imitated hypnotist.” His stage shows included convincing audience volunteers that they were strippers or farm animals. “Your legs are getting very, very heavy,” he would say. He might stand on a woman’s stomach to demonstrate the power of mind control.
In photographs he used to promote his act, Mr. Pellar is seen hobnobbing with the likes of Bill Cosby, Bob Hope, and Sammy Davis Jr. Whether he was friends with these celebrities or simply approached them at parties is unclear. He was, in fact, married for a short time to Lana Turner, star of The Postman Always Rings Twice, among other films. “He had a persuasive voice and strange, compelling eyes,” the late actress wrote in her autobiography. Mr. Pellar told her one night that he was going out for a sandwich and never returned, thus ending one of his several marriages.
Their 1972 split made the news, as did his conviction three years later for attempted murder. Mr. Pellar hired someone to kill a rival hypnotist. The hit man turned out to be an undercover police officer, and Mr. Pellar spent four years in prison.
After his release from prison, he began offering hypnotism workshops around the country. Those classes -- and the money he earned teaching them -- may have inspired him to start his own university. When, precisely, Columbia State began is uncertain, though Mr. Pellar used the name in correspondence as early as 1990. Lauri Gerald, who worked for Mr. Pellar and pleaded guilty this year to being a co-conspirator in his operation, says there is evidence that it dates back as far as the mid-1980s.
Around this time he was also running Perma-Derm Academy, which helped students become certified “dermalogists” (notice the missing “to” in the word). The business supposedly offered courses in applying permanent makeup with tattooing equipment. In 1987, after a slew of complaints, the Federal Trade Commission started investigating Perma-Derm and, in 1990, ordered it to close. It also told Mr. Pellar to refund money to students and to stay out of the cosmetics industry.
He didn’t. In 1997 he was prosecuted by the FTC for running a new business, Permanetics Inc. In the middle of his trial he fled to Mexico, where he lived in a series of hotels and aboard the $1.5-million, 80-foot yacht.
Buried Treasure?
All the while, and with almost no interference from authorities, he was making millions running Columbia State University. Students would send their checks to a post-office box in Metairie, La. A secretarial service forwarded the mail to San Clemente, Calif., where the operation was actually based. The roundabout process was set up because, at the time, Louisiana’s higher-education regulations were more permissive than California’s. (Louisiana has since passed tougher laws, forcing many diploma mills out of the state.)
Day-to-day business decisions were handled by employees in San Clemente. But Mr. Pellar still maintained a great deal of control, according to Ms. Gerald, who has turned over Columbia State documents -- like the canceled checks -- to authorities.
One of her responsibilities was sending huge amounts of money to the university’s owner while he was south of the border. Mr. Pellar prefers hard currency to bank accounts, she says. It was not unusual for him to walk around with a suitcase filled with $100,000.
He also had a tendency to bury money -- literally -- leading to speculation that there is a hole in Mexico or California that contains a fortune. “Does he have anything stashed?” Ms. Gerald says. “I have no idea.”
In 1998 Mr. Pellar was nabbed by Mexican authorities working with the FBI. After a trial, in U.S. District Court in Santa Ana, Calif., he was sentenced to five and a half years in prison on fraud charges related to Perma-Derm and Permanetics. This year he pleaded guilty and was sentenced to eight months for mail fraud in connection with Columbia State -- a relatively short sentence, considering the millions he earned with the scheme.
Mr. Pellar has declined to speak with The Chronicle. In a letter to the judge who presided over the Columbia State case, he portrayed himself as a sick, broken man, with “astronomically high blood pressure” and prostate cancer. He complained that during a hearing he urinated “embarrassingly in my pants” because the bailiffs would not let him use the lavatory.
He also told the judge that when he is released he will be “penniless” except for his monthly Social Security check. But if he is broke, what happened to all that money?
At the end of the typewritten letter, the former hypnotist added a handwritten postscript in which he said he was ready to die. “I have had a full and rich life,” wrote Mr. Pellar. That much, at least, is true.
http://chronicle.com Section: Special Report Volume 50, Issue 42, Page A13