24 sentenced in international call center scheme that bilked victims of millions

Federal agents in Houston broke up a scam run out of Indian call centers that resulted in charges against 21 residents who extorted hundreds of millions of dollars by impersonating IRS tax collectors and other government officials. less Federal agents in Houston broke up a scam run out of Indian call centers that resulted in charges against 21 residents who extorted hundreds of millions of dollars by impersonating IRS tax collectors and other ... more Photo: Taylor Weidman /Bloomberg Photo: Taylor Weidman /Bloomberg Image 1 of / 1 Caption Close 24 sentenced in international call center scheme that bilked victims of millions 1 / 1 Back to Gallery

Two dozen people have been sentenced for aiding in a massive call center scheme centered in India that tricked vulnerable people in the U.S. into giving up hundreds of millions of dollars, culminating what Attorney General Jeff Sessions praised as “first-ever” multi-jurisdiction takedown of India’s “call center scam industry.”

Callers used illegally obtained personal information and posed as U.S. government officials, convincing victims they needed to pay taxes or fines. Other participants helped collect and launder the money.

The perpetrators, who got sentences of up to 20 years, included five people in Texas, four of them in the Houston region.

“This case represents one of the most significant victories to date in our continuing efforts to combat elder fraud and the victimization of the most vulnerable members of the U.S. public,” Sessions said in a news release. “The transnational criminal ring of fraudsters and money launderers who conspired to bilk older Americans, legal immigrants and many others out of their life savings through their lies, threats and financial schemes must recognize that all resources at the Department’s disposal will be deployed to shut down these telefraud schemes, put those responsible in jail and bring a measure of justice to the victims.”

U.S. Attorney Ryan K. Patrick said the protracted investigation of the group’s “cruel tactics” and “sickening” fraud involved many federal agents and lawyers.

“These sentences should send a strong message that we will follow the trail no matter how difficult and seek justice for those victimized by these types of transnational schemes,” Patrick said. “We will simply not stand by and allow criminals to use the names of legitimate government agencies to enrich themselves by victimizing others.”

U.S. District Judge David Hittner in Houston ordered steep sentences for 21 defendants this week in the complex fraud and money laundering scheme. Hittner held a sentencing for another defendant in March and two other defendants were sentenced by federal judges in Georgia and Arizona.

The Houston defendants were held liable for $9 million restitution owed to identified victims. The court ordered preliminary orders of forfeiture against 21 defendants for assets worth more than $72 million.

In addition, 32 co-conspirators in India and five call centers based there are under indictment in the case, but have not been arraigned.

“This was a difficult case with difficult, complicated facts and terrible implications for the victims. And we are in a tough court,” said Eric Reed, attorney for Miteshkumar Patel, the manager of a Chicago-based crew of “runners” that liquidated and laundered fraud proceeds from the call scam. “My client is painfully aware of all of this and is doing all in his power to redeem himself.”

Patel, 42, of Illinois, was sentenced to 20 years and three years of supervised release for the money laundering conspiracy. He admitted to recruiting, training and “tasking” runners in his crew. He also coordinated with the Indian businesses on the operation of the scheme. The court found him liable for laundering between $9.5 and $25 million.

Another member of the Chicago team, Hardik Patel, a co-owner and manager of one of the India-based call centers, told the judge at his sentencing Friday in Houston that he was embarrassed and ashamed. He admitted previously to managing day-to-day operations at the center, processing payments and handling bookkeeping for the various call centers. He moved to the U.S. in 2015 and continued to help the conspiracy by recruiting runners.

The judge found him responsible for laundering between $3.5 and $9.5 million.

His lawyer Ali Fazel said his client has made efforts “to rectify, as much as possible, the lives he affected by his conduct, and to demonstrate remorse for his actions.”

Hittner sentenced Fazel’s client to more than 15 years in prison, despite the lawyer’s request for less.

Former U.S. Attorney Ken Magidson announced the unprecedented takedown in October 2016, explaining that a grand jury in Houston had indicted dozens of people and several overseas businesses in an international scheme that cheated more than 15,000 U.S. residents out of $300 million. Defendants were charged with conspiracy to commit identity theft, false personation of a U. S. official, wire fraud and money laundering

According to guilty pleas in the case, the centers in Ahmedabad, India used contact information obtained from data brokers and impersonated officials from the Internal Revenue Service and U.S. Citizenship and Immigration Services. Between 2012 and 2016, callers targeted thousands of people, using scripts to explain to victims that they owed the government money and would be arrested, imprisoned, fined or deported if they did not pay penalties to the government immediately.

Once victims transferred funds, a network of “runners” in the U.S. liquidated and laundered the proceeds, using stored value cards to purchase money orders that they deposited into the bank account of another person. Runners also used false identification to collect funds through wire transfers under fake names or collected bank deposits, Apple iTunes cards and other gift cards the victims purchased.

When victims were willing to pay, the call centers worked with the co-conspirators in the U.S. to obtain and launder the extorted funds via prepaid debit cards or wire transfers, according to court documents. These money transfers extended the fraud to more victims because the prepaid debit cards were registered with the names and personal information of thousands of identity theft victims.

Defense lawyer Mark Ash, whose client was given a seven-year sentence, said the fraud was believable because the IRS really does impose criminal penalties on people who don’t pay their taxes.

“Failing to pay income taxes should not be a criminal offense,” Ash said, who represented Ashvinbhai Chaudhari, 28, of Pearsall, southwest of San Antonio. “Not only were many persons scammed out of money, but the government will pay for the incarceration of these scammers and fraudsters for many years to come … In the end, we all pay.”

gabrielle.banks@chron.com

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