FBI Arrests Debt Buyer on $6.8 Million Bank Fraud Charges

  • Email
  • Print
  • Printing Articles

    1. Click here to print!
    2. ...or print directly from your browser by choosing File > Print... from the menu or by pressing [Ctrl + P]. Our printer-friendly stylesheet will make sure extraneous website stuff isn't printed.
    3. You're done!

    Close this message.

  • Comments
  • RSS

A California office of the U.S. Justice Department announced Friday that a debt buyer was arrested on bank fraud charges related to a line of credit used to fund debt purchases. The arrest was made after an investigation by the FBI.

Michael T. Sahlbach of Granite Bay, Calif. was arrested Friday for six counts of bank and wire fraud, United States Attorney Benjamin B. Wagner announced on behalf of the DOJ office for the Eastern District of California. A federal grand jury returned the sealed indictment Thursday; it was unsealed after his arrest.

According to court documents, Sahlbach owned and operated a debt collection business, National Credit Acceptance Inc., that purchases pools of consumer debts from other companies at a discount, and then attempts to collect on these debts from the consumer. In order to purchase the debt pools, Sahlbach opened a $25 million line of credit with First Bank to help support his business. The credit agreement required that if NCA wanted to buy a debt pool, it would provide 15 percent of the cost of that pool and 85 percent would be financed by First Bank.

According to the indictment, on several occasions from September to December of 2008, Sahlbach represented to First Bank that he had contracted with Lender Exchange to purchase debt pools. As a result of those representations, First Bank wired a total of $6.8 million to Lender Exchange. Sahlbach had not told First Bank that he actually controlled Lender Exchange. In fact, in August 2008, he had registered it with the California Secretary of State using the alias M. Hansen and used the address of a parking garage on Capitol Mall. If First Bank had known Sahlbach controlled Lender Exchange, it would not have extended credit.

The indictment alleges that Sahbach did not use the money to purchase debt pools from Lender Exchange, but transferred the funds to other bank accounts he controlled. He used those funds for business expenses and to provide the 15 percent contribution to receive additional funds from First Bank. Shortly after obtaining the final disbursement from First Bank, Sahlbach defaulted on the entire line of credit with First Bank.

If convicted, Sahlbach faces a maximum statutory penalty of 30 years in prison and a $1 million fine. Assistant United States Attorney Jared C. Dolan is prosecuting the case.

  • Email
  • Print
  • Printing Articles

    1. Click here to print!
    2. ...or print directly from your browser by choosing File > Print... from the menu or by pressing [Ctrl + P]. Our printer-friendly stylesheet will make sure extraneous website stuff isn't printed.
    3. You're done!

    Close this message.

  • Comments
  • RSS

Posted in Collection Laws and Regulations, Debt Buying, Debt Collection, Featured Post .

×
Subscribe to our email newsletters

Continuing the Discussion

We welcome and encourage readers to comment and engage in substantive exchanges over topics on insideARM.com. Users must always follow our Terms of Use. Also know that your comment will be deleted if you: use profanity, engage in any kind of hate speech, post an incoherent or irrelevant thought, make a point of targeting anyone, or do anything else we find unsavory. Your comment will be posted under your current Display Name, shown below. If you'd like to change your Display Name, you must update it on the My Profile page.

  • avatar Commercial Guy says:

    Another genius…

  • avatar dawn-campbell says:

    Seems to me that First Bank needs a new under writing process . Yes a crime was committed, but at the end of the day the bank funding this business, did not do its due diligence before extending credit. Parking garage address and alias’s…hmmm. I view this story as more greed involving a bank who is insured. Good job catching them. Now can they get the conviction? The sentence is more smoke. Highly doubt he will see much jail time if any with the right attorneys.

  • avatar Brian says:

    Wow! That guy has been in the business (legitimately) since the 80s maybe even earlier, and had made a lot of money in the past.. Wonder what turned him around??

  • avatar Debt Hunter says:

    And still he runs his current business, Sacor, like nothing happened at all. In fact, they are not worried at all as his mother owns the business and claims it has “zero” ties to him.

  • avatar ryon gambill says:

    Look, anyone can steal, as long as you are willing to get caught. It’s easy to trick banks into leasing you equipment from a “third” party. This is the oldest scam in the book. He just modified it a bit.

    Is it really worth the stress of a few mill to do 3-5 in federal prison? Divide those millions by years in prison minus legal fees, divorce, medical care for the stress and bam…not really worth it

  • avatar BHA LLC says:

    he bought files under one co, sold them to another company both owned by him?

    I bet the bank manager told him to go open a second company, and put it a different address so I can get it through underwriting.

    had they gotten paid, no one would care.

    when the economy crashed in sep 08>>>>a lot of people took a lot of hits.

    funny they go after this guy, when the entire country was lying on mortgage apps and credit card apps

    why not AIG? Why not Goldman, whay not BOA for selling interest?

Leave a Reply