Gephart: new federal rule opens social media to debt collectors


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PROVO – A federal agency released a new rule that would allow debt collectors to contact people not just by phone, but by text, email and even social media.

It was the first major change in debt collection rules since the passage of the Fair Debt Collection Practices Act of 1977 and reflected the way people communicate today compared to 44 years ago.

If the collectors who harass you on social media seem a little too intrusive, the rule has set limits.

One in five Utahns (21%) have at least one debt in collection.

“It opens the doors to communication,” said Lacey Cherrington, who has worked in the debt collection industry for 30 years. If you are one of them, you have probably received phone calls and letters regarding unpaid balances. Coming soon: Collection agencies will be able to text, email and send you direct messages through your social networks.

His Provo-based collection agency, The Cherrington Firm, welcomed these changes from the Consumer Financial Protection Bureau.

“Here’s the problem, collection is the backbone of a thriving credit-based economy,” Cherrington said. “And businesses and government organizations – they really, really, really rely on us to collect bad debts.”

The new rule did not give debt collectors like Cherrington carte blanche. Yes, they can contact you via text and email, but not if they know your email is being used for business purposes. In addition, messages should be sent at a reasonable time, just like phone calls.

While debt collectors will be able to drive out bad debts through direct messaging on social media, they cannot post messages that the public sees.

Suppose you have posted a photo of your new side-by-side vehicle. A collector can’t post a comment on this photo saying, “Hey, great ATV, but you owe us $ 3,500, it’s 18 months late, you deadbeat!”

“This is absolutely not a private communication,” Cherrington said of this scenario.

Regardless of how a debt collector contacts you, every message should contain instructions on how to unsubscribe from similar messages in the future. Cherrington warned that the withdrawal could lead to bigger problems down the road.

“When a consumer tries to cut off all communication, he often leaves our hands tied,” she said, “and therefore pushes us to file a complaint as the only alternative to communication.”

At this point, the new debt collection rules were due to come into effect in November.

Regulators have already warned of crooks seeking to exploit rule changes to deceive consumers.

Remember that a collector should tell you how much you owe and to whom you owe it. If they are not forthright about this, you should ask for this information before responding to a text or direct message in blue, demanding immediate payment of a debt.

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Matt Gephardt
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