Integrating Social Media and Website Reviews into Your Practice

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In March, the Securities and Exchange Commission (SEC) released a guidance update on the use of client testimonials and social media. The update provided new rules and clarifications regarding the use of third-party advisor review sites, community or fan pages and links directing clients to social-media pages.

The guidance included good and bad news. Here is the reality advisors must confront to take advantage of the new rules.

The good

The SEC’s new guidelines open the door for you to manage and leverage your online presence and credibility – as long as you do it correctly.

You can now allow public comments about you to be posted on social-media sites, and you can include a widget on your website showing these comments, even if those comments contain explicit or implicit endorsements or statements of clients’ experiences with you. However, there are some restrictions:

• The review site must be independent of your firm and any of your affiliates.
• You must publish all of the comments unedited (100% the way they appear on the review site).
• All comments must be written and posted by people independent of your firm. You can’t ghost write comments under an alias or an anonymous or assumed screen name.
• You cannot suppress (directly or indirectly) the publication of any portion of the comments or edit, organize or prioritize the order in which the comments are presented.
• You cannot compensate any user for posting their comments, including with any product or service of value.

The SEC update allows you to reference the fact that public commentary about yourself is available on independent review sites within your newspaper, radio and television advertisements.

Finally, the update addresses the rule prohibiting sending testimonials to “Friend” or “Contact” lists on social media sites. As long as the contacts or friends are not organized in a way that will identify them as current or past clients and you don’t infer that the contacts or friends have experienced favorable results from your advisory services, such publication is allowed.