The Wrong Way to Respond to Complaints on Social Media

The U.S. Department of Justice, on behalf of the Federal Trade Commission (FTC), ordered Mortgage Solutions FCS, Inc. (doing business as Mount Diablo Lending) and its owner, Ramon Walker, to pay a $120,000 penalty for disclosing the personal information of its customers in response to complaints posted on Yelp.com to settle violations of the Federal Trade Commission Act, Regulation P, the Fair Credit Reporting Act (FCRA), the Safeguarding Customer Information rule, and the Dodd-Frank Act provisions regarding Unfair, Deceptive or Abusive Acts or Practices (UDAAP).

Mortgage Solutions is a mortgage broker that collected and maintained nonpublic personal information from applicants and customers. Between approximately June 2015 and August 2016, Walker published responses to complaints posted on Yelp.com, a public website, including information such as customers’ names (first and last) sources of income, debt-to-income ratios, credit histories (e.g., late payments and charge offs), taxes, family relationships and health.

Some of the Yelp.com responses included the following statements:

• “The truth of the matter is you didn’t have one late 2 years ago. Your credit report shows 4 late payments…Not to mention the mortgage lates. All of these late payments are having an enormous negative impact on your credit score…”
• “The high debt to income ratio was caused by this borrower cosigning on multiple mortgages for his children. The borrower was also self employed and took high deductions from his business.”
• “His mother-in-law was on title but not on the new loan… This was a cash out loan, he was supposedly using the funds to pay off his kids Med School bills. The notary that sat down to sign was concerned the mother-in-law who was signing her rights off of the property had dementia…The funny thing is he admitted to me in one of our final conversations that his mother-in-law actually did have a ‘slight’ case of dementia. OK SO WHAT THE NOTARY SAID IS TRUE!!!!”

It can be very tempting to respond to complaints containing false allegations against your employees or institution with information you have in a file, and it can be frustrating that these allegations can appear legitimate on public websites due to your inability to address them head-on in the same manner. However, at no time can you include any personal information in any public response – no matter how false or incendiary the postings may be. How you respond communicates more than the complaints alleged, and the consequences can be severe.

The FTC settlement announcement can be found here.

Veronica Madsen

​PLEASE NOTE: The information and opinions provided on this blog are not intended to be legal advice. No attorney-client relationship is formed, nor should any such relationship be implied. Nothing on this blog is intended to substitute for the advice of an attorney that is licensed in your jurisdiction. No article may be republished without the express written permission of ESTEE Compliance, LLC. © 2020