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January 05, 2012 at 08:43 AM
In an update to proposed regulations that FINRA had filed with the Securities and Exchange Commission, the agency has at least partially bowed to comments from member firms, and decided not to require social media postings to be regarded as subject to a post-use filing requirement.
Originally FINRA had said that such communications, while formerly classified in the same category as television interviews and similar public appearances, should be instead regarded as retail communications and therefore, in proposed FINRA Rule 2210(b)(1)(D)(ii), be subject to requirements of NASD Rule 3010(d). “Thus,” it said, “members would not have to approve each such retail communication prior to use, and would have flexibility on how they establish their supervisory systems.” However, they would still have to file such communications.
Member firms offered arguments against the proposed rule, with Fidelity urging FINRA to retain the current definition of public appearance under NASD Rule 2210 and include interactive electronic communications in this category, “recognizing that these communications are more analogous to physical public appearances.”
FINRA disagreed with Fidelity’s assessment, arguing that there was a substantial difference between a one-off public appearance and a communication on the Web, which may linger indefinitely and be viewed by many more people than, say, a television interview or a seminar.
