Social media is becoming one of the most rapidly growing ways for community banks to communicate with existing and potential clients. Many community banks that either are involved with social media or allow their staff to use social media are required to have compliance programs for social media usage in place. However, regulators are determining through their examination processes that many banks lack formal social media policies and procedures or have policies and procedures that are either incomplete or unclear.
Social media policies and procedures apply to advertisements, client communications (such as email) or other electronic communications in general. Your bank’s social media policies and procedures should include usage guidelines, content standards, monitoring and frequency of monitoring, approval of content, record retention, third-party vendor management, functionality and information security.
Here’s a checklist outline of the elements that a comprehensive social media policy and procedures should contain.
At a minimum, the social media program should include:
All digital communications should follow advertising regulations. Regardless of whether communications involve a Facebook post or an e-blast to customers, they are considered to be advertising. So keep in mind the requirements for:
Keep copies for documentation of all your electronic communication (posts, e-blasts, e-newsletters, etc.) just like you do with any other form of advertising. Consider the following:
Train your staff regarding social media and electronic communications.
When an email message advertises or promotes a commercial product or service, the CAN-Spam Act applies. Make sure you follow the main provisions:
For all financial institutions, social media is considered to be a form of advertising or marketing and should be treated accordingly. Social media content must meet the regulatory and disclosure requirements relative to numerous consumer compliance regulations, including those with the Federal Trade Commission and the Federal Communication Commission rules. The Consumer Financial Protection Bureau is showing a special interest in social media within the unfair, deceptive or abusive acts or practices examination procedures.
While a compliance program is not a requirement for all entities, users of social media venues are strongly encouraged to have a social media program in place to mitigate the many associated risks. Social media presents the business community with unique opportunities for marketing products and communicating with customers and prospects. But, as new social media capabilities and services arise, your community bank will need to manage social media content like any other electronic information, especially in the case of civil litigation.
Melissa Henry is a compliance professional with Chartwell Compliance, the compliance consulting provider for ICBA Compliance & Risk Management.