Byline: Peter Lucas
When Judge W. Douglas Baird ordered the collection agency MarkOne Financial LLC to stop contacting Melanie Beacham and her family and friends on Facebook, it quickly raised questions about the role courts will play in governing the use of social networks by collectors.
Beacham filed suit in 2010 against MarkOne, which sent her messages on Facebook to call concerning a delinquent car loan. MarkOne also sent messages to Beacham's family via Facebook asking that they direct her to call the agency. Both acts violated Florida's consumer protection law.
While Baird's decision in March was based on Florida law, it raises concerns that the courts may have to take a more active role in governing the use of social media by collection agencies to contact debtors since the Fair Debt Collection Practices Act does not address social media.
Without clear FDCPA guidelines, collectors can find themselves in a gray area when it comes to using social media. "There are general guidelines in the FDCPA about unfair and deceptive practices, but none specifically for online communications or social media," said Susan Grant, director of consumer protection for the Consumer Federation of America. "It may be time for guidelines on how social media can be used by collectors to be put in place by the Federal Trade Commission."
One concern among collection industry executives is that without clear guidelines from a regulatory body such as the FTC, which is responsible for enforcing the FDCPA, or the Consumer Financial Protection Bureau, the courts may end up having a greater influence over rules governing the use of social media by collectors.
"Judge Baird's ruling puts collectors on notice that they can't use Facebook to communicate with debtors or their family and friends and it is likely to have a profound effect on the outcome of similar cases around the country," said Beacham's attorney, Billy Howard, head of the consumer protection department for the Orlando, Fla., law firm Morgan & Morgan.
Howard filed a second suit against MarkOne for using Facebook to contact another debtor. "I am seeing a growing trend of more …