This sounds like moat-building. But what does "the use of higher education credentials from diploma mills and unaccredited schools" actually amount to? Listing them on a CV?
"... (2) A person is guilty of knowingly using a false academic credential if the person knowingly uses a false academic credential or falsely claims to have a credential issued by an institution of higher education that is accredited by an accrediting association recognized as such by rule of the student achievement council:
(a) In a written or oral advertisement or other promotion of a business; or
(b) With the intent to:
(i) Obtain employment;
(ii) Obtain a license or certificate to practice a trade, profession, or occupation;
(iii) Obtain a promotion, compensation or other benefit, or an increase in compensation or other benefit, in employment or in the practice of a trade, profession, or occupation;
(iv) Obtain admission to an educational program in this state; or
(v) Gain a position in government with authority over another person, regardless of whether the person receives compensation for the position.
...
(4) Issuing a false academic credential is a class C felony.
(5) Knowingly using a false academic credential is a gross misdemeanor."
Seems doubtful that it gets prosecuted much though.
It defines how one might illegally use one, or issue one, or falsely claim to have a real qualification, but I don't see a definition of a false credential.
It sounds like a false credential falsely claims to be accredited (ie. if I were to issue degrees from Harvard), which is not what the OP institution is doing, so this discussion is possibly moot.