Feds Bust Scammers Who Collected $5.2 Million By Pretending To Be Cops

As you probably know, it’s illegal for a debt collector to threaten arrest over a debt. It’s also a big no-no to try collecting on a debt that doesn’t exist. Unfortunately, that didn’t stop a California man from operating a scheme where callers allegedly posed as law enforcement officers to collect on bogus debts.

According to a complaint from the Federal Trade Commission, the operation took in around $5.2 million in less than two years. During that time, at least the defendants are said to have made more than 2.7 million calls to at least 600,000 phone numbers.

From the FTC statement:

Often pretending to be American law enforcement agents such as “Officer Mike Johnson” or representatives of fake government agencies like the “Federal Crime Unit of the Department of Justice,” callers from India who were working with 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.

Another consumer told the FTC, “The callers threatened me and claimed they would arrest me if I didn’t pay them the alleged debt. One of the callers even contacted my neighbors and told me he was watching my house. The callers had a lot of . . . personal information about me, including my work address. One caller told me, ‘We just saw you walk into your office building,’ and then listed my office address. Another caller told me there were 55 warrants out for my arrest. Sometimes my caller ID would indicate that the call was from the FBI. Because the callers knew so much about me, I believed they were police officers or FBI agents. The calls scared me and I was often shaking when I hung up the phone.

If the callers were successful in convincing the call’s recipient to pay up on the bogus debt, the victims were told to put the “owed” amount on a pre-paid debit card like a Wal-Mart MoneyCard, a credit card, or to wire the money via Western Union.

“Even after victims made a payment, the harassing calls often continued,” writes the FTC, “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.”

A U.S. District Court in California has granted the FTC’s request for a temporary order which stops the defendant from continuing on with the operation and freezes the its assets.