Mumbai, Feb. 23: Call centre operators in India pretended to be debt collectors to extort millions of dollars from unwitting Americans in a phone scam that has raised new questions about the oversight of the countrys growing outsourcing business.
David Vladeck, director of the Bureau of Consumer Protection at the US Federal Trade Commission (FTC), described the scam, which was overseen by American Credit Crunchers, a US company based in California, as a brazen operation based on pure fraud.
Federal investigators say about 10,000 Americans were contacted by call centre staff in India over a period of two years. They were falsely told that they had unpaid debts which needed to be repaid immediately, and callers frequently resorted to intimidation and threats to force them into paying.
In a legal filing, the FTC said that consumers in the US had received as many as 20 million collection calls from India over the past two years.
It also claimed that since January 2010, victims had handed over more than $5 million (around Rs 25 crore), with collectors demanding between $300 (Rs 15,000) and $2,000 (Rs 1 lakh) per call.
Varang Thaker, the alleged ringleader of the operation, had used address details, bank account and social security numbers submitted by consumers who had applied online for short-term loans, to assist in the deception.
These were supplied to call centre staff in India, who then told their victims they risked losing their job or being jailed if they did not pay up. One victim, JanLaree DeJulius, 57, of Las Vegas, said: The gentleman who called knew everything about me... I fell for it. I agreed to set up instalments because I didnt want attorneys coming to my place of work. I didnt want to be arrested.
Investigators said the sophisticated scam was the first of its kind to involve call centre operators in another country. Steven Baker, the FTCs Midwest director, said the scam had arisen partly because of the falling cost of international calls. Asked if the Indian call centre knew what they were doing was illegal, he said they did to the extent that the callers were telling people they were from US law enforcement agencies.
The FTC has determined that the call centre is located in Ellis bridge, Ahmedabad.
A spokesperson for Nasscom, the industry association for the IT and outsourcing industry, declined to comment.
Vladeck said: Consumers should not be pressured into paying debt they dont remember owing. Legitimate debt collectors must provide consumers with both written information about the debt, and instructions for protecting themselves if they dont think they owe the debt.
A judge in Chicago has issued an order freezing assets owned by Thaker, who is believed to have profited handsomely from the scam. The FTC said it had taken action against an American company engaged in fraudulent activity. Nasscom and the Indian industry is strongly against fraudulent activity, whatever the country of origin, and the law should take the appropriate course against such activities.
Thaker, living in the US as a permanent resident, claims he has been trapped. I am cooperating with FTC. I have nothing to do with itů. Its somebody else who has done this. I am also a victim.