There is no debtor's prison in the U.S., and you cannot be arrested for simply defaulting on a debt. The payday lender industry is among the most predatory of all financial services. It is not unusual for collection agencies servicing such lenders to threaten debtors with arrest and prosecution. Such threats are illegal under the federal Fair Debt Collection Practices Act ("FDCPA") and the Pennsylvania Fair Credit Extension Uniformity Act ("PFCEUA"). Violations of these acts can lead to an award of damages and attorney's fees to the debtor.
You may wish to contact a local attorney who handles FDCPA and PFCEUA cases to explore your options. You may well have defenses to this debt. (Note that there is no traditional payday lending in Pennsylvania because of restrictions on interests rates. So, I am assuming that this is an online or out-of-state loan.)
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No, they cannot file criminal charges. If the collector is a different entity from the payday loan business, then you likely have a claim under the FDCPA against them for making illegal threats.
Payday loans were rendered effectively unlawful in Pennsylvania a couple of years ago. While a PA resident could conceivably apply for and obtain a payday loan, the payday lender generally may not enforce an unlicensed payday loan contract in Pennsylvania's courts.
As far as payday loan "fraud" is concerned, a person could be convicted of fraud if that was the perpetrator's provable intent, a prosecutor is willing to make a case, and a jury convicts. However, police or prosecutors usually notify a person of criminal charges, not some clown playing around with a phone.
Disclaimer: Nothing stated herein is legal advice. For legal advice, consult an attorney; I am not your attorney at this time. This response may constitute ATTORNEY ADVERTISING which has not been approved by the Supreme Courts of New Jersey or Pennsylvania or the Court of Appeals of Maryland. I am a federally-designated “debt relief agency” that provides, where appropriate, relief under the U.S. Bankruptcy Code.