The Federal Trade Commission has published a reminder to debt collectors about Fair Debt Collection Practices Act compliance risks created by the use of social media or text messages in connection with debt collection efforts.
The report highlights prohibitions and requirements and provides examples of how the use of social media or text messages can violate the FDCPA:
Collectors can't use deceptive means to collect a debt. The FTC discusses enforcement cases where it has challenged the sending of texts that allegedly used false pretenses to get consumers to call back the debt collector. The FTC notes one enforcement action that involved a debt collector allegedly sending text messages indicating that the consumer's payment using a card was declined.
The action directed the debtor to call a designated phone number immediately. Other examples of deceptive actions include a request to join a debtor's social media - such as a Facebook 'friend request that doesn't disclose that the person reaching out to the consumer is a debt collector - or an attempt to obtain location information about a consumer by using false pretenses to approach a friend or co-worker. Such an attempt might involve the use of a fake Facebook account to send a friend request to a debtor's social connections as way to obtain address or asset information.
Collectors must provide certain disclosures in the initial communication and any subsequent communications with a debtor. The FTC notes that these disclosures are required in text messages.
- Collectors can't reveal the existence of the debt to a third party or publish ''a list of consumers who allegedly refuse to pay debts.'' The FTC notes that these prohibitions are particularly relevant in the social media context ''where a post on Facebook, Twitter or Tumblr can instantly be viewed by others - and especially by consumers' social connections.''
Collectors can't collect charges unless the charge is expressly authorized by the agreement creating the debt or permitted by law. The FTC notes that debt collectors can't use social media or text messages to collect illegal charges.
The FTC also states that some industry members use their websites and social media pages to "offer helpful information for consumers’" and calls on the industry to consider whether lawfully using these platforms to offer general information “can benefit both your company and consumers.''
In 2013, the Federal Financial Institutions Examination Council - whose members include the Consumer Financial Protection Bureau - issued final supervisory guidance "Social Media: Consumer Compliance Risk Management Guidance." The guidance was intended to help financial institutions manage the risks of interacting with consumers through social media. Among the topics discussed was how the use of social media can run afoul of the FDCPA. In November 2013, the CFPB issued an Advance Notice of Proposed Rulemaking (ANPR) for collections. In response to the ANPR, industry commenters have asked the CFPB to provide exceptions and/or guidance as to how to give FDCPA disclosures with text messages.