News & Resources

New York state debt collection conviction raises warnings for the sector

Dec 04, 2012 Philip Burgess

New York state debt collection conviction raises warnings for the sector
The owner of a Buffalo, New York debt collection agency will face fifteen years in prison following a conviction stemming from violation of debt collection regulations and committing fraud. The charges compounded when investigators also found the man in possession of an AK-47. To make things worse, he then went on the lamb for four months, living as a fugitive from the law. Consumers are likely to find this news shocking, and it may suggest that lenders and collectors need to consider means of reversing negative publicity on an industry-wide level.
 Negative PR
The debt collection industry has an opportunity to build positive relationships with the public, and news stories like this one do a disservice to the the asset recovery industry. There may be ramifications for short term lenders as well when it comes to the regulation of records. Although this story from Buffalo is an anomaly and not representative of the lending, it does raise important questions on how to improve the public image of lenders and collectors. Firms might do well to address public relations concerns within the industry, considering ways to detach from negative perceptions. Law
Collectors using debt collection data face legal ramifications when it comes to the means of contact with consumers, and the means of collecting, upkeeping and disposing of data. For instance, collectors may not contact individuals over social media networks with any private information or account balances. Regulations such as this are meant to protect consumer privacy, and collectors are best served by familiarity with state and federal laws. The short term lending industry must always stay up-to-date on new and changing regulations, as well as the current state of public perceptions. Lenders and collectors can increase efforts for improved professionalism and accountability to client relations. When it comes to consumer credit reports and the management of data, full confidentiality should be ensured at every step of the process, whether hard or electronic data is employed. Lenders and collectors who act in a manner that is ethical and fair can improve public relations, which may increase revenue from lending or recovery.