Some banking institutions and debt collection agencies are taking to the social networking to locate those who owe or to lure new consumers. Regulators in Washington are putting a microscope on the practices.
Social networking slips between regulatory cracks
The Fair Debt Collections Practices Act, established more than 30 years ago, protects customers from many abusive collection methods. However, those laws were established long before there was such a thing as the Internet or social networking. Therefore, the laws 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 networking for collection, according to Mark Schiffman of the trade association.
Many think social networking should be used
However, not every Accounts Receivable Management company has listened to those words.
The practices were discussed by attorney Billy Howard 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.
Looking at the issue
The Consumer Financial Protection Bureau and the Federal Trade Commission are looking into regulating how, or even if, collectors should be legally allowed to pursue debtors on Facebook, Twitter, Google Plus and LinkedIn.
The federal agencies have already laid down rules for debt collection businesses, regulating aggressive rhetoric, making sure customers are kept updated on any legal actions, and also making it easier for consumers to register grievances.
Looking at banks more closely
The Federal Banking institutions Examination Council wants to put more limits on how financial institutions can use social networking, and it wants public opinion on the issue. You can learn more by going to:
Their website
About $12 billion in revenue is received by the Accounts Receivable Management industry yearly while 30 million American consumers are pursued by companies right now, according to the CFPB.
Say what you think
Consumers who feel they are being harassed by debt collectors should report the activity on line or by telephone to the CFPB or the Federal Trade Commission.
Social networking slips between regulatory cracks
The Fair Debt Collections Practices Act, established more than 30 years ago, protects customers from many abusive collection methods. However, those laws were established long before there was such a thing as the Internet or social networking. Therefore, the laws 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 networking for collection, according to Mark Schiffman of the trade association.
Many think social networking should be used
However, not every Accounts Receivable Management company has listened to those words.
The practices were discussed by attorney Billy Howard 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.
Looking at the issue
The Consumer Financial Protection Bureau and the Federal Trade Commission are looking into regulating how, or even if, collectors should be legally allowed to pursue debtors on Facebook, Twitter, Google Plus and LinkedIn.
The federal agencies have already laid down rules for debt collection businesses, regulating aggressive rhetoric, making sure customers are kept updated on any legal actions, and also making it easier for consumers to register grievances.
Looking at banks more closely
The Federal Banking institutions Examination Council wants to put more limits on how financial institutions can use social networking, and it wants public opinion on the issue. You can learn more by going to:
Their website
About $12 billion in revenue is received by the Accounts Receivable Management industry yearly while 30 million American consumers are pursued by companies right now, according to the CFPB.
Say what you think
Consumers who feel they are being harassed by debt collectors should report the activity on line or by telephone to the CFPB or the Federal Trade Commission.
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