Commentary

Guess Who's On Facebook Now? Debt Collectors

People are using social media in all sorts of unexpected ways: Law enforcement to publicly shame criminals, insurance companies to sniff out fraud, divorce attorneys to find evidence of infidelity... the list goes on. And now it includes debt collectors.

They are using Facebook and other social media -- perhaps illegally in some cases -- to assess the financial state of debtors, communicate with them, and sometimes even post embarrassing information about their debts that's visible to members of their social network.

The practice has become so widespread that the Federal Trade Commission is hosting a workshop on social media and debt collection during its upcoming day-long conference addressing the implications of new technologies for debt collection: "Debt Collection 2.0," schedule for April 28 in Washington, D.C.

The FTC says the conference is intended to advance discussion about issues arising from technologies which weren't necessarily anticipated when Congress passed the Fair Debt Collection Practices Act.

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The FTC's Joel Winston was quoted by MSNBC.com as saying: "Normally, collectors use social media to locate people or see if there are any assets that might be collectable. But we have received a few complaints about collectors who are using social media to either impersonate the person's friends or otherwise use it for harassment."

Indeed, debt collectors are not known for respecting personal boundaries; some of the examples cited in news reports about their use of social media are pretty disturbing. One woman who fell behind on her car payments tells the Orlando Sentinel she was harassed by debt collection agency MarkOne, which contacted her friends and family on Facebook, urging them to encourage her to pay her debt.

According to the FDCPA, it is illegal to divulge the fact that someone owes a debt to other people.

As with insurance fraud and marital infidelity, debtors can get themselves into trouble by posting incriminating photos or statements. For example, experts on debt collection law advise debtors who are claiming to be in dire financial straits not to post photos of expensive vacations, new cars, or other items which contradict this stance.

Debt collectors that see these photos online can use them as grounds for a lawsuit, according to Bruce McClary of ClearPoint Credit Counseling Services, who told MSNBC.com: "Don't post pictures of the new speedboat you just purchased or the great vacation you just took, and then tell the debt collector you're broke and don't have any money to pay them. If you're caught in a bold-faced lie, you could be fast-tracking your way to court."

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