Things Debt Collectors Can & Can’t Do on Social Media

 By Dean Kaplan, president of The Kaplan Group

For most people, social media is part of our everyday lives. But laws surrounding its use have been slow to catch up. This is as true in debt collection as anywhere else. The government recently updated the Fair Debt Collections Practices Act (FDCPA) to cover social media

It’s important to know that the FDCPA only applies to third party collectors collecting on a debt. It does not apply to the original owner of the debt. So, if you owe a hospital or store money, the FDCPA does not apply. It also does not apply to commercial debt (companies owing each other). Or, to individuals collecting from companies or each other. If your friend owes you money, you can tweet about it. If you’re a freelancer and a client owes you money then technically, you can tweet about it, but you probably don’t want to do so.

Legal vs Good Idea

As with many things, it’s important to remember that what is legally allowed and what is a good idea are often two separate things. As a commercial collection agency, we always advise our clients to avoid using social media in their debt collection. We had a client who ignored our advice and tried to use Twitter to shame a late-paying client into paying. When that didn’t work and we were hired, our negotiations started off poorly. Everyone was angry. What’s worse, we knew the other company could sue our client for illegally interfering with their business by posting the tweet. This meant court was off the table for us. We were eventually able to reach a settlement, but it wasn’t as high as it would have been if the company hadn’t started a Twitter war.

Social media reactions are not predictable. Anytime you attack a brand, company or person on social media, you run the risk of backlash. You could try and publicly shame a client only to have them turn around and tell others that they didn’t pay because your work wasn’t good. Other clients and potential clients don’t know the history of the disagreement. They may begin to worry that if they do something you don’t like, you’ll come after them on social media as well. 

Regulation F

Most reputable collection agencies have avoided using social media for years because the laws were unclear. Regulation F now spells out clearly that debt collectors can only contact consumers via DM or private message on social media sites. A debt collector cannot post on your Facebook page, or @you in a tweet or Instagram post. 

A debt collector also cannot communicate or attempt to communicate with you in a way that you have asked them not to. So, if you don’t want the collector calling your cell or using a specific email, you can say so. A debt collector also can’t contact you using an email address that they know, or should know, is a work email. For example, if a debt collector knows that the consumer works at Example Company and the email address is they should know, that email address is provided by the consumer’s employer and so it can’t be used. 

Social media and social media law are evolving quickly. If you are owed money, we advise that you do not attempt to use it to vent about the debt or to shame anyone. You should also avoid posting about your own debt as doing so leaves you vulnerable to scams and could be used against you legally. If you owe money and are being harassed by someone on social media, take screenshots and block the person. Then consider hiring a lawyer to send a cease and desist letter.  Debt problems should be resolve in private, not in the public eye.

Dean Kaplan is president of The Kaplan Group, a commercial collection agency specializing in large claims and international transactions. He has 35 years of manufacturing, international business leadership and customer service experience. Today, he provides business planning, training and consultation to a variety of global companies.