The digital age is here to stay.

Social media is a quickly becoming a vital tool for advisors, but leveraging this tool can be difficult when it comes to meeting compliance standards. Both firms and advisors need to dust off the rulebook as clients increasingly expect advisors to go digital.

“Firms that are holding out on social media will no longer be able to do so. It’s out there, it’s another form of communication,” Yasmin Zarabi, vice president of legal and compliance at Hearsay Social, told panelists at a SIFMA technology conference in New York. “The sooner [firms] accept it and embrace it and use technology to have the guardrails in place, [they’ll] be better off when it comes to retaining clients and advisors.”


The financial industry has been supervising communications with the public since its infancy. So it’s no surprise that compliance officers scrutinize the use of social media – it spreads information quickly and widely.

But one of the strongest brakes on the use of social media is a lack of understanding about how to leverage it properly. According to research presented by Hearsay Social at the SIFMATECH panel, only 27% of companies report their employees are fully aware of social media usage policies. Since social media is constantly evolving, it’s important for firms to provide regular training to advisors. The findings were based on data from research firm Altimeter.

“The [social media] training process is ongoing,” Douglas Preston, senior vice president and compliance executive at Bank of America Merrill Lynch, said at the panel.

Others agreed. Stephen Bard, senior vice president and director of communications compliance at Wells Fargo Advisors, suggested that firms should be training employees multiple times a year on the rules regarding social media.

Advisors should be proactive, though, and seek out the information themselves, argues Zarabi. She says advisors should be responsible for familiarizing themselves with the rules. If you aren’t entirely sure what the policies are, ask.

“Know your firm’s policies,” Zarabi told OnWallStreet in an interview following the panel. “Social media is just another medium like phone, email and texts. You want to be a good corporate citizen no matter what medium you’re using. Use common sense.”


When used correctly, social media provides advisors with great opportunities to connect with clients on a more personal level.

“Be findable, retain your contacts and clients and identify social signals that happen on social media,” urged Zarabi. These signals can include whether your clients have moved, had their first child or just purchased a home.

To help meet compliance standards, Zarabi recommended separating your personal and professional social media accounts where applicable.

However, including some information about yourself beyond your role as advisor can lead to clients feeling more comfortable with you. Indeed, by embracing social media and learning how to engage with it in a compliant manner, Zarabi said firms and advisors alike can better prepare themselves for the future of the industry.

“Social media serves as a good measure of your accountability and trustworthiness. Clients can see that you’re a holistic person – you coach your son’s little league, or volunteer for an organization you care about,” said Zarabi. “Clients want to do business with someone who has similar values and interests with them. Social media is a great way to view that.”

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