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By Herb Weisbaum ConsumerMan
msnbc.com contributor

Bill collectors have upped their game. They've added social media to their arsenal of tools. That's right, they're on Facebook, too!

"Normally, collectors use social media to locate people or see if there are any assets that might be collectable," notes Joel Winston with the Federal Trade Commission. "But we have received a few complaints about collectors who are using social media to either impersonate the person's friends or otherwise use it for harassment."

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For debt collectors who don't want to play by the rules, social media can be a powerful way to badger someone. They can post messages that let the world know you owe a debt — a clear violation of the Fair Debt Collection Practices Act.

Florida attorney Billy Howard, head of the consumer protection department at the law firm of Morgan & Morgan, calls social media "a dangerous weapon" that some debt collectors use to deliberately harass people.

"They're using Facebook because it adds that extra shock value. The more shocking, the more harassing, the more outrageous, the more these debt collectors get paid," Howard says. "What makes it so dangerous is you can contact somebody's family and friends very quickly and very easily, and you can set off a domino effect of panic that can be devastating."

That's what Melanie Beacham of Tampa, Fla., said happened to her. Beacham fell behind in her car payments by $362. To collect the debt, MarkOne Financial called and called. They also sent e-mail and text messages.

These practices are off limits for debt collectors

Then, for some reason, MarkOne started using Beacham's Facebook account. They contacted friends and family members, asking them to have her call the company.

"I was irate," Beacham recalls. "I didn't want anyone to be in my personal financial business. It was very disturbing. It was hurtful. It was just horrible."

Beacham points out that not only had she agreed to a payment plan before MarkOne turned to Facebook, but they clearly knew how to contact her. They had her home and work phone numbers, they knew where she lived and they had her e-mail address.

"Facebook should be off limits," she tells me.

Beecham hired Howard, who sued MarkOne, claiming violations of both federal and Florida law. The complaint states that MarkOne has a corporate policy to contact individuals and their friends and family using Facebook "as a means to harass consumers and their families."

The lawsuit is still pending. But last month, a judge in Pinellas County, Fla., ordered MarkOne not to contact Beacham, her friends or family via Facebook or any other social networking site. The order (which MarkOne agreed to) is not an admission of any wrongdoing, and it cannot be used as evidence in the case.

Even so, Howard considers it a victory. He tells me this is the first ruling in the country where a judge has specifically banned a debt collector from using social media. Howard calls it "a big win" for Melanie Beacham and people across the country who want to protect their right of privacy.

Three weeks ago, Howard filed a second lawsuit against MarkOne. Another woman in the Tampa area claims the company "intentionally harassed and abused" her by using Facebook to request she call them, even though they had her phone number and knew where she lived and worked.

What does MarkOne have to say about all of this? I spoke to Walter Riehemann, the company's general counsel, who told me they do not comment on pending litigation.

Social media isn't totally off limits
Debt collectors can and do use the Internet to find people who owe money. What you have posted for public consumption on your Facebook or MySpace page, such as contact information, is fair game for anyone to see and use. So think about what you post, and use the tools available on your social media platforms to protect your privacy.

Bruce McClary with ClearPoint Credit Counseling Solutions says it's important that what you post on your site matches what you tell debt collectors.

"Don't post pictures of the new speed boat you just purchased or the great vacation you just took, and then tell the debt collector you're broke and don't have any money to pay them," McClary advises. "If you're caught in a bold-faced lie, you could be fast-tracking your way to court."

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ACA International is the trade association that represents third-party collection agencies. Mark Schiffman, the group's director of public affairs, tells me they advise their members about "the perils of using social media" and how careful they must be to follow both state and federal law.

"You can't write on someone's wall on Facebook. You can't harass. You can't threaten. The laws are pretty clear in that regard," Schiffman says. "These laws are not guidelines: They are laws. And we believe firmly that any debt collector who is breaking the law or not following the rules, deserves to be held accountable for their actions."

Is it time to rewrite the rules for fair debt collection?
On April 28, the Federal Trade Commission will host Debt Collection 2.0, a daylong public workshop in Washington, D.C., that focuses on the new technologies of debt collection. One of the panels will be on the use of social media. And attorney Billy Howard will be there.

When the Fair Debt Collection Practices Act was written (back in 1977), e-mail, social networks and text messaging were not issues because they didn't exist. This technology gives debt collectors more ways to contact people. Does the law need to be modernized to deal with this?

For instance, should collectors be able to use text messaging? Remember, some people will pay the cost of that message. The issue is, when does the use of these new means of communication cross the line and become harassment?

"It's sort of a grey area right now," says the FTC's Joel Winston. "That's something we certainly want to explore."

More information:

Better Business Bureau advises consumers on handling debt collectors

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