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Nuanced view of social media privacy on Wall Street

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Several states are moving to ban companies from looking at the social media activity of their employees.

On Wall Street, the issue is somewhat nuanced, which has led to an interesting alliance between regulators and regulatees, as noted by the Wall Street Journal. Both agree that companies should be able to monitor social media accounts in certain circumstances in order to protect investors.

You can certainly understand the issue from the Finra point of view. It's fair to say that social media has emerged as a potent communications tool in the advisory industry. Especially when it comes to prospecting, social media seems tailor made for various customer groups.

At the same time, all brokerages understand that they simply cannot allow brokers to prospect at will through these outlets. Current law has to be respected regarding broker communications. Most firms have sought to stick closely to Finra guidance and strictly circumscribe what their brokers are able to say, providing internal services to approve communications before they are released and providing brokers lots of canned Tweets.

As the WSJ makes clear, state laws in general provide an exemption that allows for limited monitoring in special circumstances, such as a formal investigation. But Finra would like more general powers to monitor and record social media communications on a regular basis. At some point, the SEC will have to weigh in.

For more:
- here's the article

Related Article:
Companies need employee monitoring policies

 

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