In the wake of stiffer regulations, some collectors and financial institutions have turned to the social networking as a way to track down debtors and to drum up brand new business. However, federal experts are looking into limiting the practice.

Getting past all the laws

The Fair Debt Collections Practices Act, established more than 30 years back, protects consumers from many abusive collection practices. However, those laws were established long before there was such a thing as the Internet or social media. 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 media for collection, according to Mark Schiffman of the trade association.

Abuse with social networking

Not every collector listens to the advice.

Attorney Billy Howard spoke with author Carl Dougherty about the methods of some debt collectors for a piece in Bloomberg.

„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.'“

Some say the practice at times borders on stalking or harassment.

Federal experts looking at the issue

It may not be permitted for debt collectors to use Facebook, Twitter, Google Plus and LinkedIn to contact customers soon as the Federal Trade Commission and CFPB are looking into stopping abusive practices.

These organizations have already spent a ton of time creating rules to protect consumers from aggressive legal practices, so it is not easier for consumers to register complaints. New changes need to be made evidently.

Financial institutions, financial institutions also under microscope

The Federal Banking institutions Examination Council wants to put more limits on how banking institutions can use social media, and it wants public opinion on the issue. You can get more information by going to:

The Regulations Government Website

The CFPB points out that 30 million Americans are being pursued by collectors, and about $12 billion in revenue is made in the Accounts Receivable Management industry annually. That a lot of cash and a ton of abuse.

Speak your mind

Get a hold of the Consumer Financial Protection Bureau for Federal Trade Commission if you feel you have been harassed by debt collectors.

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