Social media continues to be a growing area for financial services firms. In fact, regulatory agencies have worked to handle potential social media issues throughout the years. Today, these regulations continue to become more important as social media proliferates and evolves. It’s key for financial services leaders to create thorough, intentional policies for implementing and maintaining a robust social media policy.
Challenges of FINRA and SEC regulations
Seven years ago (in 2010), Financial Regulatory Authority (FINRA) issued the first guidance to the broker community about social media. There’s been guidance from other regulators since that time, and the requirements have been similar. The Securities and Exchange Commission (SEC) added a Form ADV section for advisers to list their social media pages, including Twitter, Facebook, and LinkedIn, starting in the fall of 2016.
The SEC rule states: “Our staff may use this information to help prepare for examinations of investment advisers and compare information that advisers disseminate across different social media platforms, as well as to identify and monitor new platforms.” This guidance comes after initial concerns in 2012, when the SEC issued a risk alert that advisers needed to keep records of their social media communications. Per this alert, advisors’ reference to a like feature on a third-party website could be considered a testimonial.
Social Media Capture Considerations
While these regulatory bodies have been working to keep up with social media, financial services firms in particular need social media policies and procedures that are properly implemented and meet compliance and regulatory requirements. And given the importance of these policies, here’s what you need to consider when it comes to social media capture that’s ironclad when it comes to compliance.
1) Analyze your firm’s social media use. Workdays in a typical firm now include social media as a means of everyday communication. Teams and individual employees often send instant messages through Slack, a web-based communication platform. The platform can also be used for employee management controls and document sending.
2) Capture social media in the right format. The best format for complying with an eDiscovery or compliance request comes in native format. This way, you’ll be able to preserve your original data so that it’s not altered, deleted, or missing key information. During a data collection, be sure to also retain the original metadata with the content. This will provide opposing counsel with what they’ve requested the first time.
3) Put together firm-wide social media policies. While your company has many compliance concerns, it’s best to handle the one that continues to grow by leaps and bounds: your social media data. Be sure to implement a policy that crosses over departments, where employees in HR and IT are invested in the overall company plan. This means recognizing that recreational usage and work usage of social media are interconnected.
With all three of these considerations, you’ll want to be sure these are done in a legally defensible way. This will ensure you’re using the gold standard of compliance, since you may need to rely on this data in court or present it to a regulator during an audit.
These are only a few of the many ways your firm can stay up to date on social media concerns. Having the right social media archiving partner can help you make sense of the details and create a whole picture. That partner will help you collect, preserve, and analyze social media content that’s compliance-ready in case there’s impending eDiscovery or litigation requests. You’ll save time and money while keeping your social media data secure, updated, and preserved when a request or regulation comes up.
Ready to learn more about how to take a step-by-step approach to social media archiving? Learn more in The Big List of Web Trends That Compliance Leaders Should Watch This Year and drop us a line if you have more questions.