Compliance Solutions for Investment Advisers

Compliance Alert! Social Media

Dear Compliance Professional, Rarely do we see the SEC Office of Compliance Inspections and Examinations issue a National Examination Risk Alert. So when they do, we pay particular attention. Last week, OCIE issued just such a National Examination Risk Alert on Investment Adviser Use of Social Media. The key takeaways from this Risk Alert are:

  • Investment advisers that use or permit the use of social media by their representatives, solicitors and/or third parties should consider periodically evaluating the effectiveness of their compliance program as it relates to social media.
  • Factors that might be considered include usage guidelines, content standard, sufficient monitoring, approval of content, training, etc.
  • Particular attention should be paid to third party content (if permitted) and recordkeeping responsibilities.

The Risk Alert offers some helpful tips on how to address the social media issue. Perhaps more importantly, it has been issued by the division of the SEC that is charged with examining your advisory firm. When OCIE issues a National Risk Alert, they are giving strong hints as to what they want to see.

Accordingly, we commend you to read the Risk Alert in its entirety. It can found via the following link:

http://www.sec.gov/about/offices/ocie/riskalert-socialmedia.pdf

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