SEC Staff Provides Guidance on the Use of Social Media by Advisers

January 2012
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SEC Staff Provides Guidance on the Use of Social Media by Advisers

At a glance

January 2012 - Since many registered investment advisers use social media communicate with current and potential clients, the SEC issued a National Examination Risk Alert with suggestions for complying with the antifraud, compliance, and recordkeeping provisions of the federal securities laws.

Reflecting the fact that many registered investment advisers and their personnel use social media in various forms to communicate with existing and potential clients and to promote their services, the SEC staff recently issued a National Examination Risk Alert providing suggestions for complying with the antifraud, compliance, and recordkeeping provisions of the federal securities laws.

This is the first time that the SEC staff has provided guidance concerning the use of social media by advisers.

While many investment advisers have adopted written policies and procedures addressing social media use, this Risk Alert sets forth a number of specific factors that the SEC staff believes should be considered if and when an adviser and its personnel are permitted to use social media.