We have seen that it is forbidden to discuss someone’s faults even with the people who are aware of these deficiencies, for to focus on a person’s weaknesses is lowly.
However, when teaching or offering guidance, one may make use of real-life illustrations of improper behavior in other people and even refer to those people by name, provided that the listeners are already familiar with the behavior of these people. The use of actual situations to which the listener can relate will deliver a message that mere discussion cannot convey. Reference to negativity here is constructive and is not considered lowly.
Therefore, it is permissible to make reference to the life-style of a non-observant Jew to emphasize weaknesses in his behavior and its consequences, though his lack of observance is rooted in ignorance. However, one should be careful not to condemn the person.
One may not use examples from the past history of a baal teshuvah without his permission. Constructive intent is not a license for possible embarrassment.
It is also wrong to use examples from the life-styles of different ethnic groups within the Jewish nation unless it is clear that neither speaker nor listener is unsympathetic towards that group.
Sefer Chofetz Chaim, 20 Kislev, page 208