Debt collectors may use social media to track debtors

When you post your whereabouts on Facebook or tweet that you've come into a windfall or new job, it's not just your closest 100 friends who care.

Debt collectors are using social media sites to track those who owe money.

"It's just like debt collectors using the Yellow Pages," said Mark Schiffman, spokesman for ACA International, a debt collectors' trade association. "It's another resource."

Social media have become a public confessional as consumers plugged into MySpace, LinkedIn and other sites post all sorts of information about themselves, from their job prospects to spending habits. A lot of that information is available for the world to see - and in debt collection, public information is fair game.

Collectors use social media to locate hard-to-find debtors or to find out whether consumers are working and where. Information on the sites also might help assess whether a consumer has the means to repay. So telling a bill collector you don't have the cash to pay while posting pictures of your recent Aruba trip or new car may cast doubt on your claims of hardship.

Consumer advocates say the practice of debt collection through social media is growing, though perhaps not widespread yet. They also point out that federal consumer protections against abusive or intrusive collection practices apply in the social media world, too. Debt collectors, for instance, can't pretend to be your friend to gain access to your Facebook page.

Consolidated Credit Counseling Services Inc., a Florida-based group that provides debt management programs, started tracking the trend this summer and has heard from a few dozen consumers who said they had been contacted through Twitter, Facebook or LinkedIn by someone trying to collect a past-due bill.

Bradley Shear, a Bethesda, Md., lawyer specializing in social media, said a few of his clients have been tracked by debt collectors through networking sites - including one who said a debt collector insisted he could afford to repay a debt based on his Facebook postings.

And Sonya Smith-Valentine, a consumer lawyer in Largo, Md., said debt collectors had informed her that they are surfing social media to locate debtors, so she alerted her clients to be careful.

"It's a shock. Most people don't think of that," Smith-Valentine said. "Social media is just ripe with information for collectors to use."

Some in the debt collection industry say the use of social media is unlikely to catch on, partially because of information overload. Debt collectors have other more effective means of tracing people, and trolling for any useful information on social media sites - and the multiple posts some people make on a daily basis - is far too time-consuming, said Leslie Bender, a privacy lawyer and debt collector in Timonium, Md.

"Imagine what you would have to read to get to that point to find that information," she said.

Fred Blitt, president of the National Association of Retail Collection Attorneys, said social media are most likely to be used by debt collectors pursuing large sums, such as an unpaid $25,000 credit card bill.

Sites are helpful in finding people who frequently move, making it possible to serve them notice that a collector is suing them for payment, he said. This is useful because when debtors can't be found, a case can be dismissed after a set period of time.

But there are limits on how far debt collectors can go using social media, thanks to the Fair Debt Collection Practices Act.

Even if you publicly post your vacation or new car, the federal law would prohibit collection agencies from using that to "harass or shame you" into paying, said Richard Rubin, a consumer rights lawyer and author and lecturer on the fair debt law.

Debt collectors must identify themselves when contacting you and give the reason, Rubin said. Collection agencies also can't notify friends, neighbors or other outsiders about your debt. That means they can't tweet or post messages on your Facebook wall that you are in arrears.

Even sending you a private e-mail on a social media site is questionable, Rubin said, because the collection agency runs the risk that it has the wrong person.

But collectors can use the information you publicly post to assess whether you have the means to repay debts, possibly leading them to take you to court, Rubin said.

If you're worried about debt collectors tracking you through social media - or worse, burglars and identity thieves - take extra steps to protect personal information.

"The more you put in there, the more you leave yourself open," said Howard Dvorkin, founder of Consolidated Credit Counseling Services.

Delete personal data, such as your city, employer, spouse's name, big purchases, or any trips you have taken or plan to, Shear said.

Take advantage of privacy settings on social media sites that allow you to control who views your page or postings. Turn off the location setting on Twitter that broadcasts where you're posting from.

Review your list of social media contacts. "You have to know that the people you are letting into your circle are trustworthy," Shear said.

Even with these precautions, it's possible your information will be publicly disseminated. Friends with access to your site can forward the information to others, for example.

Or a court may open the door to your online life. A Pennsylvania court, for example, ordered a man in September to divulge his Facebook and MySpace usernames and passwords to the company he was suing so it can discover whether his injuries are as severe as he claims in his suit.

"Nothing you put online is private ... regardless of any privacy setting," Shear said. "Be careful of what you post. At the end of the day, it can come back and haunt you."

Eileen Ambrose is a personal finance columnist at the Baltimore Sun. Send her e-mail at eileen.ambrose@baltsun.com. She cannot give individual advice.

(c) 2010, The Baltimore Sun.

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