Some banking institutions and debt collection agencies are taking to the social media to locate those who owe or to lure new customers. Regulators in Washington are putting a microscope on the practices.
Getting past all the regulations
The Fair Debt Collections Practices Act, established more than 30 years back, protects consumers from many abusive collection practices. However, those regulations were established long before there was such a thing as the Internet or social networking. Therefore, the rules have been spongy on the matter.
The rules are fuzzy, but it is recommended that companies that are part of the Association of Credit and Collection Professionals do not use social networking for collection, according to Mark Schiffman of the trade association.
Some debt collectors use social media
Not every debt collector listens to the advice.
Bloomberg did a piece where they talked to attorney Bill Howard about the collector practices.
"You get a friend request from some chick in a bikini," Howard said. "You say yes, and then somebody says 'by the way, I'm a debt collector.'"
It is close to stalking or harassment, some believe.
Federal level considered
The CFPB and the Federal Trade Commission are looking into regulating how, or even if, collectors should be legally allowed to pursue debtors on Facebook, Twitter, Google Plus and LinkedIn.
Consumers will be able to effortlessly complain about any problems with rules on debt collection companies already, but apparently that will need to be expanded.
Banks, financial institutions also under microscope
There are also ways the public can weigh in on how financial instructions use social networking. This is something the Federal Financial institutions Examination Council is looking at and wants public opinion. Go to:
Their website
The CFPB states there are about 30 million American consumers being pursued by collection companies today. The Accounts Receivable Management industry earns about $12 billion in revenue each year.
Speak your mind
Anybody who is being harassed by debt collectors should report it to the FTC or Consumer Financial Protection Bureau right away.
Getting past all the regulations
The Fair Debt Collections Practices Act, established more than 30 years back, protects consumers from many abusive collection practices. However, those regulations were established long before there was such a thing as the Internet or social networking. Therefore, the rules have been spongy on the matter.
The rules are fuzzy, but it is recommended that companies that are part of the Association of Credit and Collection Professionals do not use social networking for collection, according to Mark Schiffman of the trade association.
Some debt collectors use social media
Not every debt collector listens to the advice.
Bloomberg did a piece where they talked to attorney Bill Howard about the collector practices.
"You get a friend request from some chick in a bikini," Howard said. "You say yes, and then somebody says 'by the way, I'm a debt collector.'"
It is close to stalking or harassment, some believe.
Federal level considered
The CFPB and the Federal Trade Commission are looking into regulating how, or even if, collectors should be legally allowed to pursue debtors on Facebook, Twitter, Google Plus and LinkedIn.
Consumers will be able to effortlessly complain about any problems with rules on debt collection companies already, but apparently that will need to be expanded.
Banks, financial institutions also under microscope
There are also ways the public can weigh in on how financial instructions use social networking. This is something the Federal Financial institutions Examination Council is looking at and wants public opinion. Go to:
Their website
The CFPB states there are about 30 million American consumers being pursued by collection companies today. The Accounts Receivable Management industry earns about $12 billion in revenue each year.
Speak your mind
Anybody who is being harassed by debt collectors should report it to the FTC or Consumer Financial Protection Bureau right away.
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