DEAR EXPERT
Social Media Sleuthing
Platforms like LinkedIn can be great credit and collections tools. But there are some pitfalls to avoid, as MARY E. SEYMOUR explains. Dear Expert, Social media sites like Twitter are sometimes immensely helpful when my team is doing credit investigations or involved in the collections process. But I’m concerned that there might be certain legal issues that could get us in trouble. Please give me some advice. —Twin Cities Tweeter Dear Twin Cities, The short answer to your question is: yes, there are potential problems you need to sidestep. But social media can also be very helpful when used the right way. As you may have already learned, social media sites can help you find details about customers’ financial status, corporate structure as well as their suppliers and customers. The status of a client’s research and development efforts, additional contact information, references, recommendations and complaints may also spring to light. You can also use social media to verify information contained on a customer’s credit application – or pinpoint when something they’ve written doesn’t quite “add up.” By researching social media sites, you may also learn about a customer’s business contacts and potential references that were not listed on a credit application. And information about a customer’s or a principal’s assets and liabilities could also emerge. There are other big benefits as well. You may find that gathering information about a customer, its principals and guarantors from social media is more cost-effective than running credit checks. It may lead to information regarding the financial condition of the customer and/or guarantor and may help to identify potential sources of recovery. What’s more, a principal’s or a guarantor’s personal social media presence might disclose valuable assets (or excessive spending). Do you have a professional puzzle that MFM and BCCA experts might be able to answer? We’ll mine the contact base and find the right person to answer your question. Just contact TFM editor Janet Stilson at TFMeditor@mediafinance.org.
6 The Financial Manager • March/April 2019
Be cognizant that social media platform providers and those people or entities that post content on social media sites owe no duty of care concerning the quality of content. So while you may use information obtained from Facebook, LinkedIn and Twitter for due diligence on a potential A “cousin” to social media, search engines, customer or existing customer, try to concan also be extremely helpful. By typing a firm the information you find with concustomer’s name in search engines, you can tacts at the companies you’re researching. Consider the importance of information quickly obtain current news, articles, press releases and other information that you may obtained and weight it accordingly. And be aware that social media not otherwise be able to obtain. research can be time consumReceiving Google alerts about If you wouldn’t ing and may not result in a potential customer or existing print something obtaining information that customer is a free tool for getting real-time data and up-to- on the front page will help you with a credit investigation. date information on a business of tomorrow’s One final point: you should applicant or troubled customer. newspaper, don’t never “friend” a delinquent Compare that info to tradi- post it publicly customer or its principals on tional sources of information, social media sites, such as such as financial statements, that on a customer’s credit professionals typically use Facebook or Yelp Facebook, as a way to gain access to information that has to conduct an investigation or pages. been posted in private mode, to assess the creditworthiness of a potential customer. Oftentimes, the for “friends” only. Likewise, you should never publicly post information on the financial statements is information on a customer’s social media out-of-date when you receive them. site about a delinquent account for colNOTES OF CAUTION lection purposes. Posting derogatory comRemember, however, that you must be aware ments on sites like Twitter or Facebook isn’t of a social media site’s terms and conditions. really different from making something Browsing publicly available information on public in another medium, from a defamasites like Facebook or LinkedIn – informa- tion standpoint. It raises the risk of slander tion that is public and can be seen by anyone or libel litigation. – appears to be permissible. One key rule of However, while this seems to be accept- thumb to rememable, credit and collections professionals ber: if you wouldn’t should be conservative when using social print something on media to gather such information. Care- the front page of tofully consider the accuracy of the infor- morrow’s newspaper, mation that you access. All social media don’t post it publicly platform providers disclaim any responsi- on a customer’s Facebility for verifying user-generated or user- book or Yelp pages. provided content and information. Such Mary E. Seymour is a partner in the law firm disclaimers will be reflected in the sites’ Lowenstein Sandler LLP. She can be reached at (973) 597-2376 or mseymour@lowenstein.com. terms of use and privacy policies.
