FTC Refunds Consumers $596,000 for Phantom Payday Loan Scheme

FTC Refunds Consumers $596,000 for Phantom Payday Loan Scheme

April 13, 2016         Written By Lynn Oldshue

The Federal Trade Commission is sending out over 1,700 checks totaling $596,000 to consumers who were victims of a phantom payday loan scheme last year. Under the scam, consumers were asked to pay on payday loans on which they did not actually owe money.

Several groups were involved in the phantom loan scheme, including Broadway Global Master Inc., Kirit Patel, and In-Arabia Solutions Inc. Callers working for the organizations would pose as law enforcement officials or members of fake government agencies in order to pressure people into making payments on their non-existent loans.

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The groups were told to cease operations in September 2015 after collecting more than $5.2 million in fraudulent payments. A judge ordered the defendants to pay a $4.3 million fine, but they did not have the funds to cover that. The fee was then reduced to just $608,500.

On average, affected consumers will receive a check for $350.39 in the mail. These checks must be cashed within 60 days of the mailing date, or they will no longer be valid. According to the official report, “The FTC never requires consumers to pay money or to provide information before refund checks can be cashed.” If you receive a check in the mail and are asked to pay money to cash it, you should go to another check cashing facility.

If you have any questions about the refund, you may contact the FTC at 1-844-449-3587.

The information contained within this article was accurate as of April 13, 2016. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


About Lynn Oldshue

Lynn Oldshue has written personal finance stories for LowCards.com for twelve years. She majored in public relations at Mississippi State University.
View all posts by Lynn Oldshue