Euroa couple Jacinda and Arthur Eastham. Credit:Simon O'Dwyer Nikhil Talwar secretly filmed in his office. Last year, the system cost the Commonwealth $1.3 billion in subsidies, and rising so fast that it's projected to cost $4 billion this year. Since Labor's home insulation debacle, selling online diplomas has become the quickest get-rich scheme there is. Call centres, door-to-door salesmen, and so-called "aggregators" are all marketing online courses to new students. "Clearly," admits federal minister Simon Birmingham,"[the scheme] was structured in a way that made it susceptible to shonks and fraudsters."

Birmingham has introduced some reforms. In March, the Commonwealth banned salesmen offering free laptops or iPads to people they are signing up to courses. Six months later, salesmen are still giving out free laptops, but telling students they are on loan only. They claim that the students are told they have to give it back. That's not how Arthur and Jacinda Eastham remember it. The couple lives in a housing commission unit in Euroa, and both have intellectual disabilities. In April – after Birmingham's reforms – they were doorknocked by a salesman representing Melbourne's Phoenix Institute, part of the same college Talwar represents, though there is no suggestion that he personally was involved in this sale. The salesman was told about Arthur and Jacinda's disabilities, but was undeterred. In the comfort of their living room, he offered them a free laptop and a free qualification. When they struggled with the literacy and numeracy test, he helped. "They were giving me the answers when I didn't know them," Jacinda said.

Before long, the paperwork was done, and she was enrolled to study a diploma of early childhood and education. The salesman also tried to enrol Arthur, who is 56 and struggles to read, in a business diploma at Phoenix College. "I told them I had trouble reading but they weren't interested," Arthur said. Phoenix Institute of Australia, Queen Street in Melbourne. According to the former head of Holmesglen TAFE, Bruce Mackenzie, who is conducting a review for the Victorian state government, even the most talented students struggle with online courses.

"Studying online for a full diploma is a pretty sophisticated way of learning. You've got to be an independent learner, you've got to have strong computer skills, literacy skills, and numeracy skills, which is not a characteristic of most students in VET." The money that pays for all this comes under the Commonwealth VET FEE-HELP scheme, which acts like HECS, allowing students to delay loan repayments until they earn more than $54,000. The Commonwealth therefore expects that much of its $4 billion outlay this year will be repaid. However, Arthur and Jacinda would have struggled to complete the course they were signed up to, and, as disability pensioners may never earn $54,000. The debt, however, would remain against their names. They have since withdrawn from the course. Targeting the poor and disadvantaged with the lure of a free laptop is a deliberate tactic. Talwar recommends behind closed doors that his new salesman goes to "commission houses; anyone who earns 54k or less a year". "We all have to cross the boundary," he says. "As long as I don't get a complaint in my ear, and you haven't f--kin' took a knife in your hand ... we are laughing."

Asked later about these comments, Talwar said he was talking about the physical boundaries of neighbourhoods; that he encourages his salesmen to "go where they can find new customers". The Commonwealth scheme is uncapped, and each sign-up earns about $18,000 in taxpayer money for the college. From that, colleges pay perhaps $5000 to sales agents (Phoenix insists it's less), who in turn pay their doorknockers up to $1000. It's a fully demand-driven system at both state and federal levels – the incentive for colleges to sign up students in bulk is built in. The result is that people are being lumbered with debt by the thousands for courses they probably won't complete. It's growing so fast the regulator, the Australian Skills Quality Authority, has no chance of keeping up. In Melbourne's outer suburbs, people tell of salesmen signing up entire shops full of overseas-born staff, or trawling mosques and the refugee community promising a free, no-hassle education.

In one case highlighted at a recent Senate inquiry hearing, a Vietnamese-speaking salesperson descended on a community centre and signed up seven Vietnamese students to business diplomas. Some brokers even enrol people without their knowledge. One victim, who did not want to be named, told Fairfax Media he only became aware he'd been enrolled in a hospitality course after he received a call from a college. He has since unenrolled and is trying to wipe his debt. People are turning up to sensitive workplaces such as aged care and childcare holding diplomas and certificates, but no actual skills. In a recent review of the aged care industry, the skills authority found education providers delivering courses in under 200 hours which should have taken 1200 hours. Almost half the registered training organisations had misleading information in their marketing material.

Talwar, through his company, Education Circle, is one tiny part of a sales machine which, despite the spiel, is not really selling education. They're selling signatures on pieces of paper, and receiving taxpayers' money in return. He denies this, saying, "I strongly believed that every Australian has the right to get educated that can get them to get work or better job". Nikhil Talwar's Facebook page. Credit:Facebook Before selling vocational education, many salesmen spent time churning customers through the electricity retailers. In that industry, an aggressive sales culture led to multimillion-dollar fines imposed by the Australian Competition and Consumer Commission against big companies such as Origin Energy. Following that, the industry cleaned up its act, and many of the people involved then simply moved into selling education. "In power it was $100 per sale, now it's $1000," one told Fairfax Media.

On Facebook, Talwar boasted recently to a friend about how quickly he could buy a new Tesla sports car: "Hey Simon u can buy this car 3 months $$$$$$$.00 cash. Deal need to join [my company] education circle". He later told Fairfax Media later that this was a "joke with a friend ... for god's sake!!!!" Education salesman Sandeep Sood and his new Hummer. Credit:a Another electricity salesman, Sandeep Sood, was once in charge of the Origin energy sales campaign for a company called Sales Force, part of Salmat. That campaign led last March to a $2 million fine imposed by the ACCC. Sood's new company is an education "broker" called Qantum Innovative Solutions, and he is proudly pictured on Facebook with his new Hummer. He did not respond to calls. Gagandeep Sachdeva also once sold electricity, and then moved to education. He was pictured this year with a new Porsche, which he told Fairfax Media was financed by another of his businesses.

Sood, Sachdeva and Talwar all run groups of salesmen who are "brokers" for Melbourne's Phoenix Institute, whose contracted salesman signed up the intellectually disabled Arthur and Jacinda Eastham. Education salesman Gagandeep Sachdeva and his new Porsche. Credit:Facebook Phoenix was bought earlier this year by sharemarket-listed company Australian Career Network for $4.5 million. A quiet, privately owned institution running courses in holistic counselling and transpersonal art therapy suddenly added much more lucrative online courses in business, leadership/management and early childhood development. The ACCC told Fairfax Media it was "familiar with Phoenix Institute and some of the concerns raised about its activities". But Phoenix said through a spokesman that it was cracking down on rogue salesmen, had sacked a number of agents since February and reported them to authorities.

"Instances of poor broker behaviour are historical," the spokesman said. It now interviews new students with a recorded phone call to "ensure they have the capacity to undertake the study proposed, understand course requirements and are aware of all financial obligations". Said salesman Sachdeva: "Phoenix are very strict". He also said: "We do not under any circumstances give away any incentives". Still the business of Phoenix's owner, ACN, is growing fast. Its June 30 financial report boasted that its student numbers had increased by 417 per cent from 4990 students in 2014 to 25,784 students in 2015, with an "average revenue yield per student" of $3,303. -----

Federally, minister Simon Birmingham insisted to Fairfax Media that, despite the problems, "the bulk of people who undertake VET study in Australia each year are getting high quality training that is job relevant and good value for money". Mackenzie disagrees. He says of a federal system that's grown from costing $325 million in 2012 to $1.5 billion last year – double the expected rate of growth – that the problems are systemic. "Look at the completion rate of students doing online courses using FEE-HELP: it's about 5 per cent. That speaks for itself, I think." It's also not serving Australia's need for trained workers. In 2013, enrolments in more popular, less useful, courses exceeded labour market needs by over 188,000 while, in areas of under-supply, there were 150,000 fewer enrolments than needed. Then there's the fraud. In Victoria, Mackenzie says, 10 per cent of providers are under investigation for "material breaches of contract".

"The whole business is just about getting students in, just driving students in, and no one really worries about whether students complete or not because no one has got any outcome measures. And if a student drops out, you replace them with another student." The brokers are a key part of this moneymaking enterprise, and they don't like being challenged. A few days after Talwar was caught out on secret video, a message was left on the voicemail of a phone which had only ever been used to arrange the meeting. "G'day, bro," said a voice with an Australian accent. "You're ringing a lot of people from one of the colleges to try to find a lot of info that you have no interest or need to find out. I suggest you stop doing that because you'll probably find that you might get your fingers burnt. Thanks, pal."