Financial Services Social Media Guidelines

Did you know that Financial Services could benefit from these same principles?

1)      People who follow brands on Facebook are 60% more likely to recommend them to friends? (IModerate Research Technologies, April 2010)

2)      While 77% of American consumers say they are more likely to buy a product or service recommended by someone they know… 81% go online to verify those recommendations before actually making a purchase? (Wharton University, July 2010)

3)      “Brands w/ highest ‘social media activity’ (includes reviews) increased revenues by as much as 18%”? (as presented by Media Post News, 2009)

Financial Industry Rules:

In 2010 FINRA recognized we are in the age of technology. They published critical FINRA social media guidelines for financial advisors to follow for social media marketing. These rules ensure compliance when implementing any instance of online communications. This doesn’t mean you can post anything you want, social media marketing should be handled the same way as the traditional strategies of marketing or advertising for finance professionals.  FINRA’s Regulatory notices 10-06 &  11-39 explain these principles.

FINRA is recognizing that social media is becoming a valid means of marketing. This is key because it allows you to “get out there” among the experts with your knowledge, ideas, and experience. This can be done without disclosing critical pieces of information. Like any means of marketing you are responsible to:

1)      Record the information.

2)      Meet suitability requirements (according to NASD Rule 2310).

3)      Scrutinize the responses on your blog because it is considered an “interactive forum” and there are ways to read the posts before allowing them to be released.

4)      Facebook, LinkedIn, Twitter, and other social media, are not required to have postings approved; however, protect yourself regardless.

5)      Establish disclaimers to protect your firm and clients.

6)      Have a policy in place.

7)      Assign someone to supervise posts and communications.

8)      Train your staff in social media do’s & do not’s to mitigate risk.

9)      Recognize and respect “entanglement” and “adoption theories”.

10)  It is a matter of implementing the same practices for online communications, as you would for any other marketing or advertising approach, with respect to specific investment products.

We suggest that you create procedures for recording these rules, and maintain them in your business’ Standards Operations Procedures Manual. We suggest that you also distribute these to your advisors in writing, and as well provide training. Finally, please note that  we do not advise that you publish anything until you have thoroughly reviewed all guidelines or rules, in context, as posted on and it’s referenced sources. Also note that there may be new Letters posted that may not be available at the time this blog was published. 


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