SACRAMENTO, Calif. (AP) — A California businessman pleaded guilty Tuesday to mail and wire fraud involving more than $5 million that his company collected from consumers with pending loans by impersonating authorities in threatening phone calls, federal prosecutors said.
Kirit D. Patel of Tracy entered the plea to four counts of mail and wire fraud, the U.S Attorney's office in Sacramento said.
The 71-year-old man was the owner and president of Broadway Global Master, which pretended to be a debt collection company, according to court documents.
From 2010 to 2012, Patel's workers outside the U.S. called consumers with online payday loans and threatened to arrest them if they didn't immediately pay their debts, which the callers claimed were delinquent, prosecutors said.
"In most cases, the consumers did not owe delinquent loans and the callers did not have the authority to collect the debts from those who did owe any balances on payday loans," the office said in a statement.
Federal prosecutors say Patel's company collected payments and immediately transferred the funds out of the country.
Patel is scheduled to be sentenced on Feb. 10. He could faces a maximum sentence of 20 years in prison and a $250,000 fine.