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Financial Advisor Social Media Compliance Checklist


Social media can be a powerful way to market your advisory business and connect with your ideal client base. Whether you leverage multiple platforms or just one to promote your brand, it’s important to keep compliance in sight. Knowing what you can – and can’t – post can help you avoid potentially costly fines and penalties.

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Financial Advisor Social Media Compliance Rules

Several agencies, including the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC), regulate financial advisor social media compliance. FINRA establishes rules for registered broker-dealers, while the SEC regulates both broker-dealers and registered investment advisors (RIAs).

FINRA standards require broker-dealers who use social media to:

  • Present fair, balanced and complete communications without omitting material information.
  • Avoid making false, misleading, promissory, exaggerated or warranted statements or claims.
  • Refrain from making predictions or projections regarding investment performance, with some exceptions.
  • Present material information transparently so that it’s easy for consumers to find.
  • Communicate in a way that’s appropriate for their audience.

Broker-dealers cannot link to third-party websites through social media if they’re aware that those sites contain misleading or false information. They must also supervise their employees’ business-related social media communications, and maintain records of those communications. Personal social media activity is not subject to FINRA rules, however, firms should ensure that their employees understand the difference between personal and business use to avoid breaking any rules associated with financial advisor social media compliance.

The SEC’s marketing rule, meanwhile, prohibits registered broker-dealers and advisors from:

  • Making untrue statements or omitting material facts necessary to make statements not misleading.
  • Making statements of fact without a reasonable basis for believing they can substantiate them.
  • Including information that would likely result in misleading implications or inferences.
  • Discussing the benefits of an investment service or product without providing a fair and balanced look at the risks.
  • Referencing investment advice that’s not presented in a fair and balanced manner.
  • Manipulating performance results or otherwise failing to present them in a fair and balanced manner.
  • Including information that’s materially misleading.

Advisors and broker-dealers may use testimonials to market their businesses, but only when certain disclosure requirements are met. The same applies to the use of third-party ratings in marketing materials for social media and other channels.

Social Media Compliance Tips for Advisors

Advisors reviewing their website for financial advisor social media compliance.

Financial advisor social media compliance rules shouldn’t deter you from using social media to promote your firm. You just need to know how to do so without overstepping any regulatory boundaries.

These tips can help you create a compliant social media strategy.

1. Develop a Written Social Media Policy

If your firm doesn’t have a written social media policy yet, it’s time to create one. Your policy should outline:

  • What type of content is permissible for business-related posts, per the above SEC and FINRA guidelines
  • How social media content is reviewed or vetted before it’s posted to your firm’s accounts
  • Which employees have access to social media accounts and who is responsible for monitoring them
  • Best practices for ensuring compliance with brand voice and image across different social media platforms

Your policy should also specify what employees can post on their personal accounts about the firm, and what might be considered a conflict of interest.

2. Review the Rules for Testimonials and Endorsements

The SEC’s marketing rule allows the use of client testimonials and endorsements from non-clients, with some stipulations.

If you’re planning to include a testimonial or endorsement in social media content as part of your advisor marketing strategy, you must:

  • Disclose whether the person offering the testimonial or endorsement is a client and whether they’ve been compensated to share their feedback.
  • Have a written agreement in place with the promoter that’s offering a testimonial or endorsement, with some exceptions.
  • Prohibit certain “bad actors” from acting as promotors.

Sharing testimonials from current clients on social media can be an excellent way to boost engagement and build credibility with your audience. But it does mean that you’ll need to be extra careful about ensuring any testimonials or endorsements you share are compliant.

3. Implement Compliance Reviews

Requiring all social media content to go through a compliance review before it goes live can help you identify potentially problematic posts. Some of the most important things to flag include:

  • Statements that appear misleading or that your firm otherwise cannot substantiate
  • Skewed information that only paints part of the picture
  • Omissions of material facts
  • Presentations of hypothetical performance data
  • Testimonials or endorsements that lack the proper disclosure requirements or otherwise fail to meet the SEC’s compliance standards

Software solutions can make this process easier. You might use AI-driven software to create compliant social media posts or scan your content for specific keywords that might indicate noncompliance.

4. Maintain Proper Records

SEC Rule 204-2 outlines recordkeeping requirements for broker-dealers and RIAs. Under this rule, you must maintain records of communications for five years. In the context of social media, this includes:

  • Written content
  • Comments
  • Images and video
  • Client queries

The SEC and FINRA allow advisors and broker-dealers to maintain physical, written records or electronic ones. Recordkeeping software can help you archive all relevant information as efficiently as possible and in alignment with compliance rules.

5. Secure Your Information

Social media platforms are vulnerable to hackers, making it necessary to have a solid cyber security plan in place.

Advisory firms can protect their social media accounts by:

  • Utilizing strong passwords
  • Enabling multi-factor authentication
  • Setting permissions to control who has access to social media accounts
  • Encrypting data

If you experience a data breach or cyber attack, be aware that the SEC compliance rules require you to report those incidents promptly. You must also make an annual report outlining the details of your firm’s cyber security strategy.

Frequently Asked Questions

Which Social Media Profiles Do Financial Advisors Need to Monitor?

FINRA and SEC compliance rules apply to social media accounts that are associated with the advisor’s business. For example, if you post on LinkedIn, Instagram or YouTube for business purposes, those channels would be subject to compliance guidelines. Personal social media accounts are not regulated; however, firms should make it clear to employees what type of information they can or cannot share about the business on their individual accounts.

What Types of Social Media Content Should Advisors Review for Compliance?

Advisors who use social media to promote their businesses may want to review each piece of content for compliance before it goes live. That includes any written posts; posts that include images, video or gifs; responses to post comments; and any type of interactive content, such as polls or surveys. Advisors must also tread carefully when including client testimonials or non-client endorsements in their social media content.

What Should Advisors Know About FTC Marketing Rules?

The Federal Trade Commission (FTC) outlines a broader set of marketing rules that apply to businesses when using social media for promotions. Two of the most significant requirements include disclosing affiliate relationships and obtaining consent when adding prospects to your email list. Advisors who use email marketing must also give recipients clear instructions on how they can opt out of receiving messages, per the CAN-SPAM Act.  

Bottom Line

Maintaining financial advisor social media compliance can help you safeguard your firm.

Building a following on social media can increase your firm’s visibility and lay the groundwork for conversations with prospective clients. Reviewing your current social media strategy can help you identify any potential compliance issues that may need to be addressed.

Tips for Growing Your Advisory Business

  • Social media is just one way to build your business and gain new clients. If you have limited time to spend on marketing, you might consider working with a platform like SmartAsset AMP. You can connect with leads and nurture relationships automatically, without taking time away from serving your existing client base. Schedule a free demo to learn more about how it works.
  • Deciding which social media channels to target starts with understanding who your ideal clients are and where they’re most likely to spend their time online. Focusing on the wrong platforms could be a waste of your time and marketing budget. If you’re still trying to figure out what your audience wants, you might experiment with different content formats or use digital ads to draw attention to your posts.

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