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Fake Debt Collectors from India, Stopped

In December of 2009 I wrote Frightening Calls From Fake Debt Collectors Threaten People With Jail for Payday Loans. It’s a Scam. Since that time people have been receiving an increasing number of brazen calls from fake and phony debt collectors threatening jail or arrest.

The names and telephone numbers these fake debt collectors literally scared the money out of consumers who never were obligated to pay a penny.

Today the Federal Trade Commission has made a major announcement in tackling this issue and has filed suit against American Credit Crunchers, Ebeeze and Varang Thake.

At the request of the Federal Trade Commission, a U.S. district court has halted an operation that the FTC alleges collected phantom payday loan “debts” that consumers did not owe. Consumers received millions of collection calls from India, and that since January 2010 the operation took in more than $5 million from victims, according to the FTC.

In tough economic times, many consumers turn to high-interest, short-term payday loans between paychecks. The FTC alleges that information submitted by consumers who applied online for these loans found its way into the hands of the defendants.

Often pretending to be law enforcement or other government authorities, the callers working with the defendants would falsely threaten to immediately arrest and jail consumers if they did not agree to make a payment on a delinquent payday loan, the FTC’s court papers stated. Claiming to be law enforcement, such as a local police department, the “Federal Department of Crime and Prevention,” or simply a “federal investigator,” the callers typically demanded more than $300, and sometimes as much as $2,000. At other times, the callers said they were filing a large lawsuit against the consumer because of the delinquent payday loan or would have the consumer fired from his or her job, according to the FTC.

But the consumers did not owe money to defendants – either the payday loan debts did not exist or the defendants had no authority to collect them because they are owed to someone else, according to the FTC. The court order stops the illegal conduct and freezes the operation’s assets while the FTC moves forward with the case.

“This is a brazen operation based on pure fraud, and the FTC is committed to shutting it
down,” said David Vladeck, Director of the FTC’s Bureau of Consumer Protection. “Consumers should not be pressured into paying debt they don’t remember owing. Legitimate debt collectors must provide consumers with both written information about the debt, and instructions for protecting themselves if they don’t think they owe the debt.”

The case of Mark Merola is typical of consumers the defendants targeted. A caller with an Indian accent reached his wife at home and told her Merola would be arrested and immediately imprisoned if he did not pay what he owed on a payday loan. The caller later said he knew where Merola worked and threatened to send police there to arrest him. Despite not being delinquent on any loan and not owing money to the caller, Merola was afraid of the threatened arrest, so he paid $523.87 to the defendants.

As part of its continuing crackdown on scams that target consumers in financial distress, the FTC charged Villa Park, California-based American Credit Crunchers, LLC, an affiliated company called Ebeeze, LLC, and the companies’ owner, Varang K. Thaker, with violating the FTC Act and the Fair Debt Collection Practices Act.

Over the last two years, consumers have filed more than 4,000 complaints with the FTC and state attorneys general about fraudulent debt collection calls.

According to the FTC’s complaint, Thaker obtained information – often including Social Security or bank account numbers – about consumers who had inquired about, applied for, or obtained online payday loans. Thaker worked with telephone callers in India who called consumers using deceptive statements and threats to convince them to pay debts that were not owed or that he was not authorized to collect, the FTC alleged.

Thaker also profited handsomely from this scheme, according to documents filed with the court. He has withdrawn tens of thousands of dollars from the American Credit Crunchers and Ebeeze bank accounts, the FTC alleged.

According to the complaint, Thaker and his companies:

  • falsely told consumers they were delinquent on a loan, they must pay it, and the defendants had the authority to collect it.
  • falsely claimed to be law enforcement authorities or attorneys.
    made false threats against consumers who refused to pay the alleged debts, including threats of arrest or imprisonment.

  • harassed and threatened consumers so that they often paid the alleged debts out of fear of being arrested or sued. – Source

The sad part of this fake debt collector scam is that it will pop up again.

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • erin

    I received a call from a Daniel Beck or Veck (couldn’t understand him because of his accent) and he left me a voice mail saying it was very important that me or my attorney call him back OFF RECORD so they could settle the matter at hand. Said that if I did not call him back I would be sorry and all he could do is wish me the best of luck in the matter. So I called him back and he said that AmeriCash was pressing charges against me for fraudulent id and social security number. Said they had deposited money into my bank acct. I immediately told him I didn’t know who Americash was and I don’t even have a bank acct. He started to talk really fast and told me I would be served a warrant on Wednesday and be arrested on Friday, said good luck and goodbye. Well I’ve never heard of these calls before and all I knew was that I had never been approved for any loan, I am a mother of two girls and all I could think was I was gonna get arrested for something I didn’t do. I FREAKED! I called my mother-in-law who called the sheriffs office and he said he had no warrant for me and it was probably a scam. Said I needed to file a complaint with the better business. Only problem is this guy said he was with Telly and Campbell Legal Services which doesn’t even exist!  He called from phone number 309-200-1642. Hope this helps! I think it’s a shame!

    • Jswag5

      My girlfriend keeps getting these calls they say they are from the legal dept of the united states, and that if we don’t pay they will take her house and assets. She doesn’t even own a home or car so we knew it was fake, let your friends and family know about this before they steal anymore of our hard earned American dollars.

  • Mindydavison

    I keep getting these calls from 918 area codes, 510 area codes , Blocked numbers, or it says 000000 and he uses the name John Butler or John Spartan. I’ve decided to fight back. I post their number in FB and ask all my friends to call them and Play Jai Ho from Slum Dog Millionaire. When ever they call I play the song again. This has been going on for months. Eventually a new number will pop up and the game begins again. I tell them to come arrest me I’m waiting.
    I’ve placed a fraud alert on my credit, and have a credit monitoring system. I don’t have a loan so I’m not worried.

  • Scrubbing_bubbles84

    Michael Smith and Robert something, all with heavy accents calling claiming that a lawsuit has been filed. #’s include: 877-837-4395, 213-261-5794, 917-268-2477. Got ahold of someone on the 1st #. They wanted my social to “look me up” I wouldn’t give. He said that he would transfer me to his “junior officer” and they would contact me at work. My wife then called the # and asked what company it was and he immediately hung up on her. Hope any of this helps

  • Tamikowoods39

    I was threaten with arrest if I didn’t call this India man w a accent who has called before this time from a 760-457-2203 who claimed to b Aaron johsonson this time last time he called demanding he would send someone to my job and would block my ss num and make my life a living hell saying he’s an investigator then a attorney for a somebody and that I need to hire an attorney he used another name last time he called it’s a California call I saved the voice message I have no ideal what he’s talking about but he has my name ss num and etc just wanted to share my story thanks TW

  • Mlaidback7

    Officer John Michael- Dept of Law and Investigation 954-657-9778 – claiming I owe for an online loan I never put in for or recieved. 2-23-12

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