3 Social Media Account Management Tips for LA Investment Advisors

Henry Ngo | May 19, 2015

3 Social Media Account Management Tips for LA Investment AdvisorsMost financial advisors have heard the old maxim that more than 90 percent of heirs engage new advisors after they receive an inheritance.

While disconcerting, this represents an opportunity for Los Angeles investment advisors who engage prospects and clients on social media.

Younger investors are more inclined to use social media accounts to assess potential advisors and decide who to hire.

This article contains three social media account management tips that will attract these potential clients and build relationships while honoring the regulations imposed by FINRA, the SEC, and other regulatory agencies.

Select a Focus for Each Social Media Outlet

Facebook, LinkedIn, and Twitter have different dynamics that advisors should honor for maximum effect. Facebook business pages are great forums for highlighting the firm’s charitable work, staff member personal news and interests, and participation in community events.

LinkedIn profiles can contain approved industry commentary. Twitter is the place to post links to news reports and interesting articles.

Social media communications by RIAs must conform at all times to rules that also govern personal presentations and communications. False and misleading claims are prohibited, and firms are required to provide appropriate supervision to advisors approved to use social media. In some instances, posts must be approved in advance.

Post Regularly

Social media accounts that aren’t updated regularly will soon lose followers to those that do. Even during busy periods at the firm, there are ways to schedule tweets and posts well in advance so that there’s no last-minute scrambling to find a topic.

Like all other firm communications, social media exchanges must be archived and tracked (Rules 17a-3 and 17a-4 under the Securities Exchange Act and NASD Rule 3110). Fortunately, there are technologies specially designed to track social media posts, such as RegEd's Social Media Archiving and Surveillance and Smarsh.

Emphasize Relationships

Social media is all about building relationships. Use them to showcase an advisor’s own personality and style, as well as a reference center for clients and followers to find interesting facts and articles. This environment will grow relationships that can evolve into profitable business connections.

Once those connections are established, however, advisors must refrain from using social media to actively recommend a security or other investment. FINRA Regulatory Notice 10-06 makes it the responsibility of the firm to consult the Notice to Members 01-23 and determine if an online exchange is indeed a ‘recommendation’ and respond accordingly.

Bottom Line

For Los Angeles investment advisors who take part in social media account management, navigating the rules can be tricky. They need to showcase their firm and demonstrate their financial expertise without crossing certain lines.

Larger firms tend to have their own in-house rules that interpret federal and state regulations, so any advisor wanting to use Facebook, Twitter, or LinkedIn should familiarize themselves with these rules before establishing a social media platform.


Does your firm have a social media account management policy? What posts are expressly allowed and disallowed?  Let us know your thoughts in the Comments box below.


And to follow-through on the tips introduced in this short article, be sure to download your free guide, Investing in High Net Worth Clients: The LA Investment Advisor's Guide to Using Technology to Manage and Grow Your Firm.


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Henry Ngo

Henry Ngo

In addition to his day to day NOC duties, as one of FPA's bloggers, Henry develops value based blog content sharing his technical expertise with our clients and friends. Henry addresses topical issues in real and meaningful ways communicating technical concepts in an easily digestible way.