I'd like one doner kebab and a PhD to takeaway

You can call a room above a kebab shop a university and make millions, but such degree mills harm UK higher education, says Matthew Chapman.

It is a little known fact that Green Lanes in a quiet north London suburb has more universities per square metre than any other street in Britain. In fact, one neat-looking semi in this high street is home to five universities that have awarded more than 5,000 degrees in the past two years. You will not find any sign of these seats of learning on the house itself. Inside is a single mailbox, home to what has been called the largest degree mill in the world.

Degree selling has developed into a flourishing multimillion-pound industry in Britain, with at least 15 universities or colleges promising a PhD, BA, BSc or even a medical degree in ten days. This apparent free-for-all has led to warnings, increasingly from the United States, the biggest market for these mills, that the reputation of Britain's higher education system is taking a battering abroad.

"This industry is slowly chipping away at the good image of your university and college system," says John Bear, a San Francisco-based expert in distance learning and an adviser to the Federal Bureau of Investigation on degree mills. "The United Kingdom is fast becoming the world centre for degree selling, and the government does not seem to be bothered about it."

The degree mill in Palmers Green has been operating freely for at least two years, selling an estimated 200 degrees a week at a cost of $1,500 each. Without the annoying overheads of hiring expensive teaching staff or maintaining a campus, much of this money is pure profit, the main costs being paying the sales staff and the printers who run off the degrees. Every few months, the university morphs into a new institution, with a different name, a new website, and even a new Latin motto, just to keep prospective students interested. So far, the same semi in north London has been the mailing address for the University of Palmers Green, Harrington University, Brentwick University, the University of St Moritz and, its most recent incarnation, the University of Devonshire.

The operation runs something like this: more than 1 million junk emails are sent every week from a server in Romania offering degrees and urging people to call a toll-free telephone number in the US. You call the number, leave a message on an answering machine and within 24 hours a salesman phones and gives you the pitch. Paul Burke was the name of my salesman, a fast-talking South African with a London phone number and the tone of a man on a commission. "Upon registration," he told me, "you will receive in ten business days either a bachelors or masters degree or even a PhD that will be based on your knowledge and life experience."

Best of all, he explained, the university had a sophisticated backup system in case a prospective employer wanted to check where you did your degree. The University of Devonshire provided a telephone number, and on the end of that line would be a nice-sounding secretary who would confirm what degree I had studied and the fact that my professors were overjoyed with my work and could tell my boss-to-be that I was a very promising young man.

"Ninety-five per cent of companies don't bother with verification," Paul assured me, "but the 5 per cent who do we have to take very seriously."

What allows the likes of Paul and the scores of other sales staff peddling these degrees to operate legally in this country, is a loophole in the 1988 Education Reform Act. The law says that anyone can call a dingy back room above a kebab shop a university, as long as they do not state that it is a British university or claim to give out British degrees. The result has been a growth in institutions with quintessentially British-sounding names, such as the University of Somerset or Knightsbridge University, which have British addresses, but which do not claim to give out British degrees.

The target market is the US, where workers in the public sector can earn promotions and pay rises depending on their higher education qualifications.

Policing of these universities in Britain is virtually non-existent. As a result, they have become increasingly brazen in the way they flout the law. Take Paul, the University of Devonshire's salesman. In answer to a question about what sort of degrees he was offering, he says: "Even though it's an English university it's geared for Americans, but it is English, there's no doubt about that."

All this might sound rather harmless, if not laughable, were it not for the fact that people are buying these degrees and wreaking havoc. Gary Stocco, a 33-year-old lab technician, is awaiting sentence in North Carolina after being found guilty of fraudulently claiming to be an expert in burns injuries and testifying in up to 20 trials. Stocco's evidence was influential in freeing some defendants and convicting others, all on the basis of two degrees bought from the University of St Moritz, otherwise known as Palmers Green University et al .

In their defence, some of these self-styled universities claim they are quite legitimately offering degrees based on life experience, a practice widely followed by established British universities, although it never forms 100 per cent of a degree course. Some legitimate universities have settled on 30 per cent as being an acceptable portion of a degree that can be awarded on life experience, but it raises the question of how high you can go with that percentage before you enter the realms of the degree mill.

Certainly, honorary degrees do not require any exams, and it is accepted that Oxford University awards MAs costing Pounds 10 to its graduates without their having to take any exams. There is no suggestion that Oxford is doing anything illegal or unethical, but it goes to prove that there are no hard and fast rules about how degrees are awarded.

In fact, Oxford's reputation as a world-class university has long made it a target for degree mills trying to cash in on a famous name. There are at least four institutions of dubious reputation out there with Oxford in their title. The university's lawyers are kept busy writing threatening letters to try to shut them. So sensitive is the subject that they are very reluctant to comment. "We've been told by the lawyers not to say anything about this," said a spokesman for Oxford who did not wish to be named. "The feeling is that simply by bringing this up we are encouraging more people to go out and use our name."

The Department for Education and Employment is reluctant to get involved in policing degree-selling in this country. It says it is a matter for the Department of Trade and Industry and trading standards officials. This leaves some baffled. "This is all about education and the reputation of British education," says John Bear, author of the annual tome Bear's Guide to Earning Degrees Non Traditionally . "I can't understand why the Department for Education does not think degree mills are its responsibility. It seems to be willing to entrust all of this to a few overworked weights and measures men."

Having been alerted to the existence of a dozen or so degree mills in this country, the DFEE has promised to investigate what can be done. "I will take this up with the DTI and see if there is anything more we can do to make sure these places are exposed," education minister Baroness Blackstone says. But she admits the government is severely limited in its actions by the law. "We cannot do anything to close people down if they are basically foreign-based companies trading in the United Kingdom. That is outside our jurisdiction, and it is for the governments of their countries to deal with them."

By cleverly picking their way through the law, degree mills can operate with impunity in this country. Perhaps it is only a matter of time before we have one making the same offer as a recent US mill. It has set up a programme offering hundreds of PhDs in nuclear safety engineering.