The recently revised Fair Debt Collection Practices Act
allows debt collectors to use email, text and social media to communicate with consumers. But it has led to a plethora of scams, watchdogs are warning.
“Although some consumers may
prefer to communicate through more modern channels, others may encounter difficulty distinguishing between a legitimate and a fraudulent or otherwise unauthorized collection attempt,” the Idaho
Department of Finance warned last week.
The announcement adds that debt collectors must include “an opt-out option for receiving further messages when reaching out through social
media, email, or texts.
Critics have decried the use of digital channels for debt collection. And email senders have wondered: Should email be used for debt collection at all, given
the impact on marketing?
Brands have enough trouble getting their emails opened. The channel should not be viewed as a potentially hostile one.
It remains to be seen if email
will work long-term. Many consumers will be reluctant to open an email from a company trying to collect a debt, given the threat of malware and online fraud.
Most consumers who fall behind in
payments will remedy the situation in good faith, but not all. They might direct such emails to their promotions or junk folders
Meanwhile, the department urges consumers to:
-
Scrutinize any debt collection communication received.
- Avoid clicking on unknown links and never disclose private or financial information to unknown entities or individuals.
-
Verify a third-party debt collector is license to do business in your state.
- Be wary of anyone who wants you to repay a debt you do not recognize.
Importantly, consumers
should confirm the debt is legitimate and belongs to them by requesting debt validation documents in writing as set forth in the FDCPA 15 USC 1692g.
The revisions to the Fair Debt
Collection Practices Act went into effect last year.