Federal debt collection rules have been updated to keep pace with changing technology.
On Oct. 30, the Consumer Financial Protection Bureau issued a final rule which permits debt collectors to use text messages, email, social media and voice messages for communications with debtors. The rules apply to all forms of collection covered under the Fair Debt Collection Practices Act, including mortgages, credit cards, medical debts and any consumer debts for personal or family purposes.
Starting in 2021, debt collectors will be able to contact consumers via text, email, social media and voicemails, which many consumer advocates worry will subject more people to being victims of phishing scams. While most people know that clicking on links from unknown sources is risky, scammers have gotten quite good at making it difficult for consumers to tell the difference between an honest inquiry and an illegal one. No matter the method of communication, the rules of debt collection are the same as they always have been. According to the CFPB, a debt collector cannot:
- Withhold information. They are required by law in their initial contact to tell the consumer the name of the creditor, the amount owed and provide verification of the debt if the claim is disputed.
- Pressure the consumer to pay using a wire transfer or prepaid credit card. They also cannot force anyone to make a payment on the spot.
- Ask the consumer to provide sensitive information like bank account, routing numbers or Social Security numbers. These are not necessary for a collector to know.
- Threaten to tell one’s social circle or employer about the debt without their permission, although they can ask others about the consumer’s whereabouts.