By Carl Pry
Most banks maintain a formalized marketing compliance person or staff tasked with reviewing and approving all advertising and marketing messages before they are published or otherwise released. Processes are implemented and followed to look at print ads, Web pages, marketing scripts and the like. But is your bank catching everything that should be reviewed for compliance? What about social media, for example?
Similar to marketing compliance, most banks have formalized channels for social media conduct on sites such as Facebook, Twitter, LinkedIn and others. Any messages issued by or on behalf of the bank must be screened and authorized. Often messages are authored by a specific person or group.
Does your bank have a social media policy for its employees? Not a policy governing employees’ use of personal social media while on the clock, but rather a policy around what employees may say about the bank or their jobs while on their own social media sites or accounts.
Is your message an advertisement?
Consider the following example: a loan officer, on his own Facebook or LinkedIn profile page, mentions he’s a loan officer at your bank. In several posts he mentions that he is in the business to make loans, so if the reader is in the market for a mortgage or car loan, he or she should contact him. Maybe some specifics of loan products are offered. What to make of this type of statement?
Simply put, this message is considered an “advertisement” and must follow all the rules any other ad must. There is no exception in any law or regulation for statements made via social media. In this case, depending on how much detail is included, Truth in Lending (Reg. Z) and the Fair Housing Act (FHA) requirements must be followed. At the least, since the word “mortgage” is included, the words “Equal Housing Lender” or the logo must appear on your employee’s postings. Unless there are strong controls in place at the bank regarding these types of messages, chances are your bank has a noncompliant ad on its hands.
Some banks have policies prohibiting employees from mentioning the bank at all on personal social media. While certainly a conservative stance, this is unnecessarily restrictive. With proper controls, social media can be a valuable sales tool. Other common social media policies restrict employees from making derogatory statements about the bank, or complaining about working conditions, fellow employees, and the like. While this may be a good idea, by itself it is not enough.
Compliance considerations must be taken into account when a message or post crosses the line to advertising. Simply put, any message (regardless of the media in which it appears) that promotes the availability of a bank product or service is considered an ad. It doesn’t matter whether the message is intended for the general public or an individual, or whether it comes from the bank itself or one of its employees.
The key is to recognize when a messages crosses that line and to ensure all applicable requirements are then met.
Carl G. Pry, CRCM, is a managing director for Treliant Risk Advisors in Washington, D.C., where he advises clients on a wide variety of compliance, fair lending, corporate treasury, and risk management issues. Email: cpry@treliant.com
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