This document discusses leveraging social media for financial advisors amid changing regulations. It provides an overview of compliance considerations for major social networks like LinkedIn, Twitter, and Facebook. Record keeping, testimonials, suitability, advertising, and supervision are key regulatory areas. Case studies show how financial firms have used social networks successfully, such as acquiring new clients and business opportunities. Real examples demonstrate driving customer loyalty and closing new business through social connections and content. The document concludes by questioning whether social media will replace cold calls in the future.

1. Confidential and Proprietary © 2012, Actiance, Inc. All rights reserved. Actiance and the Actiance logo are trademarks of Actiance, Inc.
Leveraging Social Media Amid the Changing
Regulatory Landscape
Joanna Belbey- Social Media and Compliance Specialist
Victor Gaxiola- Subject Matter Expert, Social Media
@Belbey @VictorGaxiola #BDI1

2. 2
#TeamActiance
Facebook.com/Joanna.Belbey
Linkedin.com/in/belbey
@Belbey
About.me/JoannaBelbey
Facebook.com/VMGaxiola
Linkedin.com/in/victorgaxiola
@VictorGaxiola
About.me/VictorGaxiola
@belbey @victorgaxiola #BDI1

3. 3
Compliance
10 of 10
8 of 10
Top US Banks
Top European Banks
About Actiance
Key Partners
76%
2 of 3
Global Wealth Managers
60,000+
Finance Professionals on Socialite
5 of 5
Top Canadian Banks
Social
We are the Market Leader
13M+
Social Network Connections
Global Operations
North American
Financial Services Market

4. 4
@
@belbey @victorgaxiola #BDI1

5. 5
Wikis
Public
Instant
Messaging
Public
Instant
Messaging
Industry
Networks
Industry
Networks
WebWeb
Unified
Communication
Unified
Communication
FutureFuture
Social NetworksSocial NetworksCollaborationCollaboration
Today’s social
business
can’t use
just one
collaborative
technology
to keep its
employees
connected
– it needs to
use them all.
@belbey @victorgaxiola #BDI1

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Leads to Several Challenges
• Complexity
• Adoption
• ROI
Enablement
• Feature Control
• Data Leakage
• Incoming
Threats
Security
• Regulations
• Corporate
Policies
• Legal Hold
Governance
@belbey @victorgaxiola #BDI1

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Compliance Overview For Social Media for Financial Advisors
Record
keeping
Preserve records of written
business communications for
specific time periods. (If you
write it out, it’s “written”.)
LinkedIn - Updates, InMail;
Twitter - Tweets, Direct
Messages; Facebook – Posts,
Messages. Regulators only are
interested in business
communications. Includes Third
Party content. Includes personal
devices, as content, not source,
is determinative
Work with third party to capture,
archive and make e-discoverable all
written communications. Many firms
prohibit retweets to avoid
appearance of “adoption and
entanglement” with resulting
recordkeeping and advertising
requirements.
Regulation Definition Recommendation
@belbey @victorgaxiola #BDI1

8. 8
Compliance Overview For Social Media for Financial Advisors
Testimonials
Testimonials are prohibited for
Investment Advisors (IAs) and
need to be qualified for
Registered Representatives
(RRs).
Many firms prohibit
“Recommendations” and “Skills” on
LinkedIn, “Retweets” on Twitter and
“Likes” on Facebook to avoid the
appearance of an endorsement.
Suitability
“Know Your Customer”.
Recommendations must be
suitable for every investor.
Most firms prohibit product
recommendations and investment
strategies unless preapproved by a
registered principle of the firm.
Regulation Definition Recommendation
@belbey @victorgaxiola #BDI1

9. 9
Compliance Overview For Social Media for Financial Advisors
Advertising
Content standards are
the same as other
communications. Firms
are also responsible for
both suitability and
recordkeeping of third
party content (links,
posts).
Most firms prohibit retweets, favorites and likes
to avoid appearance of “adoption and
entanglement”. Static content, such as a
LinkedIn Profile that contains more than
business card information, is an advertisement
and requires pre-approval. Interactive
communications do not require pre-approval.
LinkedIn, Facebook and Twitter have both.
Supervision, recordkeeping apply.
Supervision
Firms must evidence
that they are super
vising communications.)
Use similar written supervisory procedures
already in place. Employ risk- and principle-
based principals for review. Limit access to social
media unless supervised. Pre-approval of
content is required in certain cases. Appropriate
training is required. New FINRA Rule 3110(b)(4)
includes supervision of internal communications
to comply with FINRA and MSRB rules.
Regulation Social Network and RecommendationsDefinition Recommendation
@belbey @victorgaxiola #BDI1

10. 10 @belbey @victorgaxiola #BDI1

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• LinkedIn – read only
– Listening is key, watching connections who matter
– Use to see “money in motion” events
• Real results
– LinkedIn Connection retirement status change = $2.75m
account acquisition
– Job Change noticed on Status Update = 401k rollover
– FA obtains 400 new prospects in Energy market
– New commercial account opportunity through
colleague’s LinkedIn connections
Case Study: Wealth Management Firm (NJ)
@belbey @victorgaxiola #BDI1

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• Situation
– LinkedIn already available to 1200+
– Veteran Advisers, tech savvy
– Authentic content
• Real results
– @MaryS_rwbaird
• 51 followers
• 93 Tweets (at the time)
• $1m prospect, later closed
Case Study: RW Baird
@belbey @victorgaxiola #BDI1

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Drive customer loyalty
A friend sees an owie,
and sends
a cure.
@belbey @victorgaxiola #BDI1

14. 14
Leverage your connections
In a company
town,
building a
network,
closes business
for you.
@belbey @victorgaxiola #BDI1

15. 15
Close new business
At a marathon, a supporter, became a client.
@belbey @victorgaxiola #BDI1

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And finally, will Social Media replace the cold call?
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• info@actiance.com
• @Actiance
• @belbey @victorgaxiola
• Further reading:
– FINRA 10-06, 11-39 Matrix
– FINRA Social Media Handbook
– Belbey Blogs: FINRA Spot
Checks Call for Social Planning
Thanks! Contact Information