A final order has been reached between the Federal Trade Commission and a number of individuals and companies that harassed consumers to make payments on loans that did not exist. The original charges were made more than three years ago by the FTC.
Under the terms of the settlements, those who were involved in the scam, Kirit Patel, Broadway Global Master Inc., and In-Arabia Solutions Inc., are permanently banned from the debt collections business. In a separate criminal matter, Patel pleaded guilty to mail fraud and wire fraud and was sentenced to one year in prison. The final order imposed a monetary penalty of $4.3 million, but due to the defendants’ inability to pay, has been lowered to $608,000.
The defendants often purported to be law enforcement officials when making calls to collect on payday loans that did not exist. The defendants made nearly 3 million phone calls to 600,000 different numbers, and collected more than $5 million.