Is this Unethical- CA disclosed info about my debt to third party.

Ok, so I defaulted on a storefront payday loan. I did call them and make a payment or two, but then we ran into some hard times and I had to stop. Was hoping to hold off until I received my taxes. Well a collector from one of the CA's handling the loan called my MIL today and told what storefront he was calling from and that if I would be in contact with him, he could work out an arrangement on what I owe and that if I wait, it will be sooo much more. Now, I could be wrong but are they not allowed to disclose information regarding the debt to a third party? I get that they can call whomeever they choose, but he also told her that I gave them as a reference ( I did not) and to call as an emergency number. Is there any recourse for me here on this? My business is my business and I don't need the added stress of my family being called over these damned loans.
Thank you in advance.