FINRA and Social Networking


Wall Street bankers and analysts increasingly want to use social networking to connect and interact with customers. But financial services companies have a hard time trying to comply with the compliance and regulatory requirements.

Social networking sites such as Facebook, Twitter and LinkedIn provide new ways for financial service firms to connect, inform and interact with their customers. They also raise new compliance challenges. As currently designed these sites may not allow you to archive and maintain the communications on your own books and records.

Apparently FINRA understands this. At the Securities Industry and Financial Markets Association Annual Meeting on October 27, 2009, FINRA Chairman and CEO, Rick Ketchum announced that they had formed a Social Networking Task Force. The group is comprised of industry participants to explore how regulation can embrace technological advancements in ways that improve the flow of information between firms and their customers—without compromising investor protection.

So how does that explain the absence of social networking sites in the latest proposed changes to FINRA’s communications rules?


One Response to FINRA and Social Networking

  1. Bill Winterberg November 1, 2009 at 9:32 am #

    FINRA announced a webinar in December to cover compliance and regulatory requirements of social networking use. Details are on FINRA’s website: