Wow – that’s a mouthful – but given the regulated nature of the financial industry, I didn’t want to get it wrong;-)
I first mentioned the need for financial reps to take care with recommendations in 2009, and FINRA has issued an update to their most recent regulatory notice that seems to clarifiy things.
I’m not in the industry, nor a lawyer, nor a doctor, but it seems reasonably clear…
If you’re in the industry, you may have already had a look at the direct source:
It’s a rather lengthy pdf with 2 pages of advice and then 5 pages of Q&A / FAQ.
It covers the use of social media sites like LinkedIn as well as personal devices like blackberries, iphones, and other smartphones.
Actually, they call it “recordkeeping”, but the intent is the same.
The industry is required to keep certain communications for 3 years and be able to pull this material back.
The regulators don’t seem to care about the method, but the contents. If a rep is required to keep those records because they concerned “the business”, the rep is going to be in trouble if those records are not kept…
The second big aspect covers what financial reps say about themselves – anything that might be deemed a public statement or appearance.
You know – the stuff they really don’t want anyone saying like “I guarantee you’ll double your money in X years!”
This sort of material has to be pre-screened / vetted / hung up the flag-pole.
A financial rep’s use of social media might easily cross that line…
It’s the content, stupid
My big takeaway from reading the material – keep aware, and err on the side of caution. Don’t be the one they want to make an example of…
The “industry” does a good job of patrolling the financial organizations centrally – in the front office, the back office, and through all the standard media.
With everyone having internet service both at home and on the go, the reps have easy access to ‘get around’ all of those built-in mechanisms. FINRA seems to be saying – ok – we can’t keep the capabilities from you, but you’re still responsible for the content you send and create.
If you break the rules, you’re going to be in trouble…
So watch yourselves.
To your continued success,