The SEC has repeatedly included issues around social media in its annual exam priorities for investment advisers. With the SEC’s recent release of a final rule on the subject, the SEC has taken that “exam priority” to the next level.
Under this new rule, investment advisers will have to complete an additional component to their annual Form ADV filed with the SEC. In doing so, investment advisers will have to disclose their addresses for Twitter, Facebook and LinkedIn. So what’s the point?
By requiring this disclosure, the SEC can better focus on each examined firm’s use of social media. Undoubtedly, the SEC will use this information when framing its examination of individual firms.
The SEC can also use this information on an ongoing basis to assess what firms are putting out there on social media. The industry has to assume that the SEC will be doing more with this information than just tucking it away for examination purposes.
This new rule should incentivize you to review your social media policy, assuming that you have one. If you do not have one, you need to have one prepared.
You should also monitor the information that your firm is putting out there on social media. Does it confirm with SEC rules? Rest assured. If you are not minding the store, the SEC will.