Beacon Hill Fund Services, Inc.: Social Media Compliance Guidelines for Advisers, Mutual Fund

Dec. 5, 2011 - PRLog -- Columbus, OH—December 5, 2011--Beacon Hill Fund Services, Inc., specializing in developing and delivering services to investment advisory firms broker dealers and their registered investment companies, delivers best practice guidelines to social media compliance to financial services firms.

“There are almost as many social media surveys as there are social media users,” said Jim Pierson, manager of field sales supervision at Beacon Hill Fund Services. “Various surveys show usage among financial services firms (broker dealers, mutual funds, investment advisors, etc.) of anywhere from 50 percent to more than 80 percent depending on the type and number of firms responding to the surveys.”

However, there are clear regulations applicable to Social Media for Financial Services companies from regulators such as The Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA).  Below are guidelines for complying with those regulations from Beacon Hill Fund Services, Inc.

There are four basic steps a firm must complete to assure compliance with the various regulations.  The first step is to draft and implement written supervisory policies and procedures surrounding social media.  These policies must prohibit any use of social media for business purposes unless it is conducted by company authorized and trained personnel, performed on approved web sites, captured and retained by the firm and where necessary approved and approved by a firm principal.

Secondly, the firm must communicate its policies to all employees and implement and document training programs for employees authorized to conduct business related social media communications.  This training should emphasize the advertising and communications rules governing business communications.

As part of the policies and procedures, firms must develop and implement programs to monitor social media communications.  This includes supervising and monitoring company approved social media as well as monitoring for any unauthorized use of social media.  This should also incorporate monitoring social media sites for any mention of company name or products by persons not affiliated with the company.

The final step is to make certain that all company authorized social media is captured and archived.  The regulations applying to company advertising and emails also apply to company approved social media communications.  Many of the firms that have developed email monitoring and archival solutions are either developing products or partnering with firms that can capture and archive social media communications in accordance with regulatory requirements.

Beacon Hill is a provider of management and support services to the investment management industry and its regulated investment company products, specializing in serving as the Principal Underwriter and Distributor; providing experienced industry personnel to serve as Fund Chief Compliance Officer (CCO) and Chief Financial Officer (PFO/Treasurer);and delivering business management, and governance and related consulting  services to registered advisers and registered investment company products.