The Securities Exchange Commission published an update to Form ADV last week. I’m going to devote this week’s stories to some of the new requirements. Today, I’m looking at reporting of social media.
Item 1.I of Part 1A of Form ADV currently requires registered investment advisers to list their websites. The SEC is casting a wider net.
Instead of just websites, the SEC is requiring the listing of accounts on social media platforms such as Twitter, Facebook and LinkedIn. We will be required to include the address of the registered adviser’s social media pages. (see page 34 of the release)
There were comments to the proposed release about the scope of this listing requirement. It’s limited to accounts on social media platforms where the adviser controls the content. You are not required to disclose information on employee social media accounts. It’s also limited to publicly available social media platforms.
Twitter, Instagram, and Facebook all fall clearly into this requirement.
LinkedIn is little fuzzy. A company can update the company page on LinkedIn. But many firms just have the default company page on LinkedIn. A firm can control the content, to some extent, but may not have exercised any control. That being said, those pages that have not been edited don’t provide much information. It would be unlikely to be of interest to the SEC. But if you are publishing information, then clearly the SEC is going to take a look at when it comes to exam time.
I do have a question about dormant accounts. I know many firms signed up for an account to control a particular account name, without intending to actually publish information. I remember back in the early days of Twitter, Lexis Nexis ignored the platform. Some yahoos grabbed the handle and started publishing strange stuff on the @LexisNexis twitter account. Lexis would eventually get it back because it was its trade name. I think you would need to list these unused accounts.
A hitch will be updating this social media information. If you add a new account or create an account on a new platform you will need to file an update to Form ADV, just as you would if you created a new website.
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