US university that signed MoU with UP govt had its approval revoked few days earlier

Official records from the US, reviewed by The Indian Express, show that the university’s official approval to operate was revoked barely 10 days before the announcement.

They also show that the face behind “Austin University in San Francisco” and “Austin Consulting Group” is the same: Ashraf Al Moustafa, who described himself in an interview to The Indian Express as a US citizen of Egyptian royal descent.

According to an order issued by the California Department of Consumer Affairs, approval granted in 2011 to Austin University in San Francisco to operate as a “non-accredited private postsecondary education institution” was revoked on December 8, 2022 — and a fine of USD 9,965 was imposed on it.

Furthermore, according to performance fact sheets between 2016 and 2020 uploaded on the university’s website under US government regulations, it offers MBA courses but does not have any registered students.

When contacted by The Indian Express over the phone, Moustafa said: “I recently formed the Austin Consulting Group, which is for-profit, specifically for the project in UP and another one in Egypt. I also happen to be the founder president of Austin University, which is non-profit, but that has no connection to this MoU.” Moustafa said he holds “over 50 per cent stake” in Austin Consulting Group.

Photographs shared by the UP government along with its initial announcement of the MoU show that Moustafa was present at the signing along with UP Finance Minister Suresh Khanna and former minister Sidharth Nath Singh.

The two Ministers were not available for comment. A top UP government official said the state government will follow all procedural requirements before finalising the deal. “We signed the MoU with Austin Consulting Group. All due processes shall be followed before going ahead with the project. This is just an MoU, which is not binding on us,” the official said.

UP Additional Chief Secretary (Infrastructure and Development) Kumar said the proposal on the investment was shared with the UP government on December 16, and signed by Moustafa, Austin University Chancellor Dr William Kent, and Chief Operating Officer of Austin Consulting Group and Austin University Dr James Kennedy.

According to the California Department of Consumer Affairs’ order against the university, dated November 7, action was taken on a complaint from the Bureau for Private Postsecondary Education, State of California.

The order shows that the Bureau listed two counts: the university did not pay its “annual fees” for 2019 and 2020; an inspection by the bureau could not find the university at its registered address.

The records include a memo from the Bureau dated August 19, 2021. It states: “Bureau staff attempted to conduct an unannounced Compliance inspection at the Institution… Bureau staff arrived at the Institution’s office space located on the second floor of the building and found that there was no one at the school, the front door was locked, and there was no furniture inside and the lights were off. Bureau staff could not locate any signage with the Institution’s name or business hours…”

The California order, meanwhile, described Moustafa’s testimony as “not credible”.

“Al Moustafa also testified, again not credibly, that respondent charges its students only $4,500 for degrees, and that respondent’s instructional staff members are all unpaid volunteers. Al Moustafa’s evasive and occasionally dishonest testimony gave no information about how respondent has conducted its business since 2019 or will conduct its business in the future. It did not even establish that respondent actually continues or intends to continue offering instruction as a private postsecondary educational institution,” the order stated.

When asked about the order, Moustafa said: “The university had to shut down in 2020 due to Covid. It also moved to a different place.”

Questioned about the status of Austin University, Moustafa claimed that the institution has 5,000 students enrolled, including those who stay “on the residential campus”.

Asked about its submission to the California administration that it does not have any students, he said, “There are no on-campus students. But we have students who attend our classes online. I can send you pictures also. Look, this is just an MoU. It is not binding on either the UP government or us.”

The website of Austin Consulting Group describes it as an “American leading management consulting firm based in the San Francisco Bay Area”.

According to Moustafa, the Group’s valuation runs into “10 billion USD”. When asked about the UP investment proposal, he said, “We plan to invest 7 billion USD in the first phase of the UP project. Of the total amount, 1 billion USD will be invested by the Austin Consulting Group, while the remaining will come from other investors. The campus will be spread over 5,000 acres. We will be in UP next month to scout for land, which we will buy in cash.”

Responding to another question about the events leading to the MoU, Moustafa said he had made a presentation to the Uttarakhand government in 2019. “There was an investors summit when I made the presentation. But the Uttarakhand government could not offer more than 20 acres of land. This time, I met the UP ministers who were visiting the USA and the MoU happened,” he said.

“In UP, if the project works out, we will roll out the first phase in three years. The first phase will be spread over 1,000 acres and six programmes will be launched. We will tie up with the best institutions in the world like Standord and Oxford,” Moustafa said, adding that the MoU was signed in San Francisco.

On its website, the Austin University claims to be accredited by the UK-based Accreditation Service for International Schools, Colleges and Universities (ASIC). But the university is not listed in the directory of accredited institutions maintained by the ASIC.

In October, records show, the US Bureau conveyed to the university that “ASIC is not a U.S. Department of Education recognized accreditor”.