Living amidst a Pandemic

The coronavirus (COVID-19) crisis has severely transformed everyone’s lives all over the world. Many have suffered a reduction in incomes or job losses with businesses severely affected and are unable to maintain mortgage payments, credit card bills, and household debts. For defaults on unsecured debt to a department store, a credit card, or medical debt, the creditor could refer debts to a collection agency.

Debt collectors are reputed to use aggressive tactics, like repeatedly contacting debtors, usually on phone, to goad them to settle debts. From end-2022, collectors get more powers to contact you by email, text, and over social vide amendments to the federal Fair Debt Collection Practices Act (FDCPA). When collecting from debtors, the FDCPA stops debt collectors from using unfair, deceptive tactics or abusive language. When Congress passed the FDCPA law in 1977, digital communication methods like text messages, emails, voicemails, and social media were not mentioned. As these communication methods are common, the Consumer Financial Protection Bureau issued a final rule amending Regulation F (implementing the FDCPA), about how debt collectors can use digital communications. The rule is effective one year after publication in the Federal Register in November 2021.

Enhanced Debt Collection

Under this final rule, a debt collector could even call you once each week, besides sending unlimited email and text messages. The CFPB rule confirms that debt collectors contacting you through social media. How collection agencies utilise social media to advantage remains unclear. Rules prohibit debt collectors from contacting you on a social media platform if the message is seen by the general public or social media contacts. A debt collector sending a private message through Facebook or LinkedIn, ask to be added as contacts, is also supposed to disclose their debt collector identity. Whether debt collectors will comply with these norms is not clear, but the historic number of job losses and the devastating economic downturn that this pandemic has caused, allowing multiple phone calls every week and an unlimited use of electronic/social media communications from debt collectors, can only add to the stress, Americans are already coping with.

Debtor Protection Too?

The rules provide some protection for debtors and if a collector sends a text, email, or any other electronic missive, it must also provide options to opt out of getting those communications. The steps for opting out aren’t included in the rules. All voicemails from the collection agency should be limited to include the collection entity’s business name (not necessarily indicating debt collection business), request your response to the voicemail, besides providing contact information for the person you could contact. A debt collector cannot communicate or attempt communications with you by sending emails to an email address that the debt collector knows is actually a work email address, subject to some major exceptions. Again, it is an open question and remains to be seen if collectors can possibly comply with these stringent requirements. Remember that the FDCPA prohibition on undue harassment, like contacting you excessively, as also a ban on communicating at the most unlikely of times and places, applies equally to electronic medium of communications, such as emails and texts. If you feel a debt collector has violated FDCPA guidelines when dealing with you, do consult an attorney to get professional advice about available options.