Social Media Guidance for Debt Collectors

Social Media Guidance for Debt Collectors

While the publication was not intended to create new regulations for Debt Collectors, it does offer guidance on what is allowed…and what is not in social media sites.

The SLC invites the state regulators to adopt and regulate, using the “guidance in their efforts to ensure…consumer protections practices adequately address the compliance and reputation risks raised by activities conducted via social media.” Social media is defined as an online site that facilitates online interaction and communication, networking and virtual worlds. Emails and Text messages are NOT included in this definition of social media.

Financial institutions are reminded they need to practice due diligence due to the increased risk and exposure both to customers and themselves on social media. If a regulation exists in the physical institution, the social media site must follow the same regulation. Such as fair lending, truth in lending and other government regulations.

All negative comments on the Financial Institution social site should be treated as complaints and/or inquiries and processed the same. The institution is not required to respond to those comments unless currently valid office of management and budget (OMB) control number is displayed on the site. If the institution does respond via social media, they must not violate regulations in their answers, and must watch privacy and informal comments to avoid omitting required disclosures.

Financial institutions are welcome and even encouraged to entice new customers using social media. However, debt collectors who use social media such as Facebook to “friend” debtors, cannot hide the purpose of contact. Any misrepresentation of intent through social media can be a violation of the new social media guidance.

If you feel your institution has damaged you by not protecting your financial privacy, omitting proper disclosures or misrepresenting themselves to you in order to collect a debt, contact us now risk free to learn about your options.