A bill introduced in the New York State Senate would make it illegal for debt collectors and creditors to use social media when attempting to collect debts.
NY Senate Bill 3803 is now before the Senates Consumer Protection Committee. If ultimately passed, as written, it would be a violation to use a social networking website as an instrument to help collect on a consumer claim from a debtor.
The issue has been a hot-button topic in the collection industry in the past 10 years, since social media sites such as Facebook became widely used. The Fair Debt Collection Practices Act has still not been amended to address social media language. Collectors have not received clear guidance from federal regulators about using such sites and thus many in the industry have tiptoed around the fringes of tapping into social media - mainly using sites for skip-tracing related purposes.
Many in the collection industry have expected the Consumer Financial Protection Bureau would be the first to specifically address social media and related collection rules. But the New York bill is believed to be the first regulatory effort to address the topic directly.
Sen. Kevin Parker, D-Brooklyn, introduced the bill. It specifically cites preventing "debt collectors from using online contact information as a means to collect on a consumer debt. Parker referred to media stories as the main justification for seeking new rules. In the text of the bill, Parker stated: "Several news reports have revealed that debt collectors use the Internet, particularly social media websites, as a means to communicate with debtors and to try to collect on debts. This invasion of personal privacy should not be allowed in New York.