Ignite Consulting Partners directed one of its recent tips of the week at collection departments and their staff. When touching on third parties and references, Ignite asked the question many collectors might, too. “What can you say and not say?”

Firm experts responded to that question by stating, “Don’t be a victim of bad habits and information.”

They continued by acknowledging many collectors “just naturally assume that if a customer isn’t communicating it’s acceptable to start calling references and other third parties. It’s not and it can create liability. 

“The general rule is that references and other third parties can be contacted to learn the location or good contact information of the account holder. If you are in contact with the account holder, then you don’t need to speak to a third party, and doing so can create liability,” Ignite went on to say.

The firm suggested that finance companies and their collections departments document account notes about why contact with a third party is needed. The reasons could be the customer is “lost,” has changed a phone number or direct mail has been returned.

“These facts can be important later,” Ignite said.

Experts wrapped up this skip-tracing discussion with these points.

“If contact with a third party is appropriate, then be sure to understand the limits,” Ignite said. “The collector can identify themselves and say they are trying to locate the customer and the third party was provided as a reference. If asked, they can say whom they work for. They should never discuss the account status, the underlying debt, or any other information.

“There’s lots of litigation on this subject, both from customers and third parties, so make sure your team knows the rules,” the firm went on to say.

If you would like to discuss your insurance policy, or just want to talk about your situation, you can contact the compliance professionals at Ignite Consulting Partners via email at info@ignitecp.com or call directly at (817) 900-8754.