-- A federal judge has sentenced a California man to a year in jail for his role in an expansive phony debt collection scheme in which people posing as police used threats and harassing phone calls to pry millions of dollars from victims around the U.S.
Kirit Patel, head of a California company that investigators said was the U.S. front for India-based boiler rooms, made a deal with the U.S. government last year in which he pleaded guilty to four counts – two mail fraud and two wire fraud.
Patel’s company has also reached a settlement with the Federal Trade Commission to pay $608,500 -- of an initially-ordered more than $4.3 million -- to assist victims.
Patel was seen in an ABC News investigation in 2012, declining to respond to questions about the debt collection scheme that federal investigators said involved fraudsters in call centers convincing countless cash-strapped Americans that they owed money linked to previous loans. At the time of the ABC News report, investigators believed the criminals had dialed at least 2.5 million calls and pried more than $5 million from their unwitting victims.
Some victims reported getting several dozen calls per hour. One, Cindy Gervais of New Orleans, said she began receiving the calls after going online for a legitimate quick loan. She paid the loan off, but then the “debt collectors” with Indian accents called to tell her she owed more money.
They "more or less told me that if I didn’t pay, they were going to have someone on my doorstep to arrest me,” Gervais told ABC News in 2012. “And that they were going to contact my place of business and tell them what kind of person I am.”
After receiving scores of complaints, investigators with the FTC said they began tracking the calls, and following the payments. They said the payments led them to Patel.
“I would say that all roads of this scam, or many of the roads of this scam, lead back to Mr. Patel,” Jon Leibowitz, then the FTC Chairman, said in ABC News’ original report.
ABC News tracked Patel for weeks, from the suburbs of San Francisco to Austin, Texas. When ABC News finally found Patel, and asked about his company, he declined to comment.
At the time, an attorney for Patel said he was “as snookered by the people in India as anybody,” and that his client believed he was setting up a legitimate company. He continued to make that argument at sentencing.
“This collection activity was carried out by persons other than the defendant, and was accomplished through call centers in India,” Patel’s attorneys wrote in his sentencing report. He was “victimized by a young and unscrupulous son of a family friend in India,” they wrote.