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Archiving for FINRA Social Media Compliance

Financial firms are naturally cautious when it comes to new communication technology. After all, they understand that regardless of the medium the general rule applies; they are accountable for all business communications. Plus, each new communication channel comes with its specific compliance issues that need to be figured out BEFORE any actual use.

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However, social media isn't new anymore. FINRA has created specific guidelines all the way back in 2010 (Regulatory Notice 10-06) and in 2011 (Regulatory Notice 11-39). That means, with a proper social media policy in place, financial firms just need to follow the guidelines and can Tweet and Post just like everyone else.

Of course, a bit of discretion is involved. While a certain post coming from an individual might seem innocuous, coming from an investment advisor, can mean an entirely different thing. "SELL when you can" coming from a buddy referring to football fantasy, would mean something quite different coming from a broker.

A good social media policy can take care of a lot of this. Separation of accounts, specific guidelines to who can say what, and specific approvals for different accounts can help ensure what goes out is vetted properly.

Controlling what goes out is only half the battle. The other significant aspect is keeping accurate records of all business communications; who said what, when.

1. Recordkeeping The obligations of a firm to keep records of communications made through social media depend on whether the content of the communication constitutes a business communication.

Rule 17a-4(b) under the Securities Exchange Act of 1934 (SEA) requires broker-dealers to preserve certain records for a period of not less than three years, the first two in an easily accessible place.

Among these records, pursuant to SEA Rule 17a-4(b)(4), are “[o]riginals of all communications received and copies of all communications sent (and any approvals thereof) by the member, broker or dealer (including inter-office memoranda and communications) relating to its business as such, including all communications which are subject to rules of a self-regulatory organization of which the member, broker or dealer is a member regarding communications with the public.”

The SEC has stated that the content of an electronic communication determines whether it must be preserved.

How to record social media communications

Even for a technically sophisticated user, social media record keeping seems onerous. Sending out a Tweet is one thing, now you're supposed to record it? For three years?

This sounds like a job for Superman social media archiving. Social media archiving is a technology solution that automatically monitors specified social media feeds and archives all the activity associated with that feed. It also provides authentication, so that the record can be verified.

PageFreezer Software has been providing this service since 2010 to hundreds of financial firms. We know the rules, inside and out, and have the technology and systems for easy, simple, affordable FINRA social media compliance. Using the same dashboard, you can also archive all your website and blog content.

Visit our Financial Services Compliance page to learn more.

Michael Riedijk
Michael Riedijk
With more than 20 years of experience building successful technology companies in Europe and North America, Michael Riedijk is recognized as a leading innovator in compliance technologies. Originally from The Netherlands, Michael relocated to Canada and launched Pagefreezer in 2010.

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