A US businessman used callers from Ahmedabad to fraudulently collect debt from recession-hit Americans who had taken short-term payday loans, which are high interest loans with a promise to return the entire amount — principal and interest — by the next salary day.
The callers were not genuine debt collectors. By using calls that threatened to turn them over to police, they collected money owed by Americans and vamoosed, and did not pass on the money to the lender. In many instances, they extracted payments out of people who did not owe anyone anything.
A federal court on Tuesday shut down businesses owned by Varang K Thaker, at the request of the Federal Trade Commission. No criminal charges were filed.
“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. FTC said Thaker had got hold of information filed in online applications.
Thaker ran two companies called American Credit Crunchers and Ebeeze, both based in California. The US has accused him of using used India-based callers to pursue victims in the US.
He collected more than $5 million in the two years he has been in the business starting January 2010. Thaker seems to be of Indian origin, but it could’t be confirmed.
The trade commission couldn’t say if the Indian callers were part of Thaker’s business or stray guns for hire. They also couldn’t say if they will be pursuing them in India.