Social network sites: Collection gold mine or land mine?

Many businesses are using social networking sites as a tool to get problem customers to pay up. But you’ll want your A/R staffers to tread carefully in this area.

First, here’s an example of how social networking sites can help Collections efforts.

Many companies on LinkedIn list the names of officers your customers may not have furnished you with — info which could prove to be useful for future Collections effort.

In addition, a company’s profile may reveal info about plans for new offices or hiring new employees — clear signs that the company has enough money to pay its debts.

But here’s the tricky part: When it comes to using info you find on social-networking sites as a skip-tracing tool, there’s a significant amount of confusion about what’s actually legal under the Fair Debt Collection Practices Act (FDCPA).

So it’s better to err on the side of caution when it comes to using social networking info as a collections tool.

Here are two tips to pass along to collections staffers to avoid legal problems:

1. Never misrepresent yourself. “Friend-requesting” a client in the hopes of obtaining info to use against them later is a huge mistake. The FDCPA expressly forbids collectors from misrepresenting themselves.

2. Don’t put too much weight on any info you find. After all, there’s always a chance what you find isn’t true. In addition, some customers may have accidentally made their profiles open to the public. For example: Playing a certain online game on Facebook has been known to reset users privacy settings to zero.