California resident, Ran Phantom allegedly ran a debt collection scam from his home, according to the Federal trade Commission (FTC).
The defendants’ scheme involved more than 2.7 million calls to at least 600,000 different phone numbers nationwide, according to the Federal Trade Commission. In less than 2 years, they fraudulently collected more than $5.2 million from consumers, many of whom were strapped for cash and thought the money they were paying would be applied to loans they owed, according to FTC documents filed with the court.
Often pretending to be law enforcement agents or representatives of fake government agencies like the “Federal Crime Unit of the Department of Justice,” callers from India who worked for the defendants would harass consumers with back-to-back calls, according to the FTC. One consumer reported that the caller threatened to have her children taken away if she did not pay, according to court documents.
In difficult economic times, desperate consumers often turn to high-interest, short-term payday loans between paychecks. The FTC alleges that information submitted by consumers who applied for these loans online found its way into the defendants’ hands. Because the callers had this information, which often included Social Security or bank account numbers and because many of the victims already were in a bad financial situations, they often believed that they owed the defendants the money, according to the FTC.
The defendants typically demanded several hundred dollars and, in violation of federal law, routinely used obscene language and threatened to sue or have consumers arrested, according to the FTC’s complaint. They also threatened to tell the victims’ employers, relatives, and neighbors about the bogus debt, and sometimes followed through on these threats, the FTC alleged.
Once victims were pressured into paying, the callers instructed them to use a pre-paid debit cards, credit cards or Western Union so the money could be deposited into one of the defendants’ merchant processing accounts, the FTC alleged. Even after victims made a payment, the harassing calls often continued, forcing them to change their phone numbers, or close their credit cards or bank accounts in an effort to get the calls to stop, according to documents filed with the court.
The FTC alleged that of the $5.2 million the defendants collected, almost $1 million was returned or charged back by their merchant processor, resulting in consumer injury totaling more than $4.2 million.
If you are being harassed about a debt that is not yours please call my office, The Law Offices of Todd M. Friedman at (877) 449-8898