Have you ever heard a FINRA tweet? The social media universe meets the securities world: part 1

The first of a two-part series discusses the introduction of social media universe in the securities world. This article discusses Securities and Exchange Commission and Financial Industry Regulatory Authority recordkeeping regulations governing broker-dealers, SEC recordkeeping regulations governing investment advisers, and requirements for investment advisers regarding supervision and monitoring of communications. Social media networking and marketing exists in a paperless, border-free world with few built-in controls. The current regulatory scheme for securities attempts to tether social media communications to long-standing, paper-based standards. In order to understand the unique challenges that social media poses for the securities industry, one must start at the base of a firm's duty to protect consumers from false, misleading or other potentially harmful communications. When broker-dealers and investment advisers overcome the obstacles of capturing and retaining social networking communications, the next nut to crack is the question of how to supervise such activity.