Tag: LinkedIn

LinkedIn and Compliance for Private Funds

LinkedIn-Logo

At the recent  I was talking with another attendee about LinkedIn and the SEC rules on advertising. The basic question was can her employees use it. That became a more nuanced discussion of the various features.

One topic was the messaging feature of LinkedIn. You can send massages to people on LinkedIn. It’s not a great tool, but some people like it. Her interest was because some of her employees wanted to use it to communicate with clients and potential clients. That was the first red flag.

As a registered investment adviser, her firm was subject to the record-keeping rules. Rule 204-2(a) (7) requires an investment adviser to keep records of certain communications between the adviser and its clients. If the communication is happening on a third-party platform, it’s outside of the investment adviser’s reach. That means getting a third-party application to capture that communication. There are several vendors who claim to be able to do so. ( Smarsh is one. Global Relay is another. )

The other question that I, and those nearby, latched onto was the “testimonials” implication of LinkedIn.

The advertising limits under Rule 206(4)-1 limit the use of any communications “which refers, directly or indirectly, to any testimonial of any kind concerning the investment adviser or concerning any advice, anaylsis, report or other service rendered by such investment adviser.” LinkedIn has several features that could be considered a testimonial.

The first is the recommendation feature. If a client writes a recommendation of the investment adviser, you’ve violated the rule. A recommendation would be considered a testimonial. The SEC’s view is that a testimonial may not represent the experience of a typical client. You can agree or disagree with the rule, but the rule is still in effect. My opinion was to have her employees shut off the recommendations feature and not allow them to use it.

The other feature that raises concern is the skills and expertise feature. That allows your connections to endorse particular skills. I personally find this feature to be wonky. The list of skills and expertise that I see in my profile seem a bit random and off base. Although some are right on target.

If a connection endorses a skill and expertise, I think that is a testimonial. Given that the endorsement could be from a client, then publishing that endorsement would violate the advertising rule’s ban on testimonials. My recommendation was to ban use of that feature.

What are your thoughts on the use of LinkedIn?

 

Implementing Compliance Practices for Social Media

I was in the audience for FINRA’s latest educational Program: Implementing Compliance Practices for Social Media.

This program addressed implementation of new guidance that FINRA recently issued in , concerning social media.

Introduction

Tom Pappas

FINRA does not endorse any particular practice and each firm will have to do things differently. The views in this webinar will not provide a safe harbor.

Summary of FINRA Regulatory Notice 10-06, Guidance on Blogs and Social Networking Web Sites

Joseph Savage

addresses five different areas:

Recording-Keeping. You need to keep copies of the information you publish, regardless of the form. FINRA is aware that it’s not easy to capture this information when using third-party sites like Facebook. (Tough. Deal with it). You can file screenshots with FINRA.

Suitability responsibilities (Notice to Members 01-23). You are better off not recommending any specific investments.

Types of interactive electronic forums. Generally, postings will be considered advertisement, but interactive postings are a public appearance (so you do not need principal approval). They felt that Twitter posts and Facebook updates would be interactive electronic forums.

Supervision of social media sites (Regulatory Notice 07-59). This should be a risk-based review.

Third-party posts (“Adoption” and “Entanglement”). Generally, third party content is out of your control. But if you arrange for third party content or endorses it, then you may be deemed to have adopted that content and treat it as if you adopted it directly.

The notice is just guidance, not a rule. FINRA is looking at a new rule. See Regulatory Notice 09-55.

Firms’ Perspectives: Is Social Media Right for Your Firm?

Doug Preston & Joanne Rodgers

Doug pointed out the tremendous growth of social media. Regardless of the form and how it works, you need to use the sites in compliance with rules. (The rules are not going to adapt to social media.)

Joanne is doing a pilot with a vendor to help with compliance. They had lots of requests from recruiting and sales to use the tools.

If you use a social media site for personal purposes, can you still list that you work for the financial services company? You can have a “business card rule.” Just post the information on your business card, with no call to action or specific information.

Is this a growth area or just customer pressure? They have no data. Sales really want to use the tools to generate business. They view it more as a lead generation instead of a sales tool. Recruiting is an avid user of social media sites, especially LinkedIn.

Nobody has much data on the cost/benefit of using social media sites.

Firms’ Perspectives: Developing Social Media Pilot Programs

Doug Preston & Joanne Rodgers

Joanne has just finished a pilot for 25 agents and 25 recruiters. She saw that most of the agents participated in Facebook, more personal than business. The recruiters mostly used LinkedIn. (She did not want to disclose the vendor she used.)

Doug has not opened up the broker side to social media. The bank side does use it. They using some of that learning to build a system for the broker side.

One issue is the level of activity and the additional resources needed to review activity. The tools may be free, but they require people resources and time.

The key is the ability to obtain and retrieve the records and to move the records into your email surveillance program. It’s also important to be able to shut off some of the functionality on social media sites.

Firms’ Perspectives: Compliance Practices Concerning Social Media

Doug Preston & Joanne Rodgers

There are lots of risks. You need to draw a line between sites you control and those run by third parties. You can stuff on a blog you host that you can’t do on a third party blog platform.

You will need new processes and policies. You will need lots of training.

FINRA is ahead of the curve compared to some other regulators in the financial services industry. Insurance regulators have not addressed the use of social media.

One of the big risks is brand/reputation risk. Each of the registered representatives becomes a brand ambassador. If they say some thing bad or embarrassing it affects the company as well as themselves.

What is FINRA looking for? If you are using social media, they will want to see: written procedures, actual supervision, records and procedures.

They did not like LinkedIn recommendations. Registered representatives should not accept the recommendations.

The static versus interactive categories is the toughest one to deal with.

Third-Party Postings

Joseph Savage, Doug Preston, Joanne Rodgers, & Joseph Savage

Questions 8, 9 & 10 in address the issue of third party posts. You probably should put in a disclaimer if you let third party posts on your site. You should monitor them to make sure there is no inappropriate material (porn, copyright). You also need to monitor complaints.

A reg. rep. “favoriting” something or “liking” something could be considered adopting that third party statement.

Program Summary

The session should be available online in a few weeks.

FACULTY

Tom Pappas (Moderator) is Vice President and Director of FINRA’s Advertising Regulation Department. The department regulates the advertisements, sales literature and correspondence used by FINRA firms. His responsibilities include rule development, management of the filing and surveillance programs and related enforcement activities. He served in the same role at NASD before its 2007 consolidation with NYSE Member Regulation, which resulted in the formation of FINRA. He joined NASD in 1984 and was previously with Davenport & Company LLC. He received a bachelor’s degree from The University of Richmond and an M.B.A. from Virginia Commonwealth University.

Douglas Preston is a Senior Vice President and Compliance Executive at Bank of America Merrill Lynch (BAML), as well as Chief Compliance Officer for Merrill Lynch Professional Clearing Corporation, the firm’s prime brokerage arm. He is also responsible for a number of other compliance areas at the firm, including serving as the Chairman of the firm’s Enterprise Electronic Communications & Media Governance Committee, and leading BAML’s Global Banking & Markets Electronic Communications & Media Compliance team, among other responsibilities. Prior to BAML, Mr. Preston was Senior Special Counsel at NYSE Regulation. In his role at the NYSER, Mr. Preston helped develop and interpret various NYSE rules. He has worked on several major regulatory initiatives, including Regulation SHO, gifts and entertainment and electronic communications (NYSE 07-59), among others. Before joining NYSE, Mr. Preston was the General Counsel and Chief Compliance Officer (CCO) for Santander Investment, SA’s New York investment bank. He was also the CCO of the investment banking arm of the Bank of Nova Scotia, and Associate General Counsel for the Securities Industry Association (now SIFMA). Prior to SIFMA, he worked in private practice, representing financial services entities. Mr. Preston received his J.D. from Fordham University School of Law. He is a member of the Bar of New York, New Jersey, Washington, DC and the U.S. Supreme Court.

Joanne Rodgers is a Vice President of Compliance at New York Life Insurance Company (NYL).  She is responsible for managing the sales material review unit, field review unit and market surveillance. Ms. Rodgers has worked at NYL in various roles of compliance for the past 15 years. Prior to joining NYL, she worked as an examiner at NASD. She is a graduate of Franklin & Marshall College with a B.A. in Business Administration.

Joseph P. Savage is a Vice President in FINRA’s Investment Companies Regulation Department. Mr. Savage specializes in a broad range of securities regulatory matters, including investment management, investment company, advertising and broker-dealer issues, and regularly appears at conferences regarding these issues. Prior to joining FINRA, he was an Associate Counsel with the Investment Company Institute and an attorney with the law firms of Morrison & Foerster LLP and Hunton & Williams. Mr. Savage also served as a judicial law clerk for United States District Judge John P. Vukasin of the Northern District of California. Mr. Savage holds a bachelor’s degree from the University of Virginia, a master’s degree from the University of California, Berkeley, and a J.D. from the University of California, Hastings College of the Law, where he served as Note Editor of the Hastings Law Journal.

Boston Bar Association Presentation on Web 2.0

Martha Sperry of Advocate’s Studio asked me to join her in a presentation to the Boston Bar Association’s Computer & Internet Law Committee titled: Beyond LinkedIn: Advanced Social Media for Lawyers.

Martha Sperry, OneBeacon Insurance Group Ltd., and Doug Cornelius will lead a brown-bag lunch discussion for lawyers who are familiar with the various forms of social media but want to take their use to the next level. Would you like to make better use of social media in your practice? Are you interested in starting a blog or Twittering about legal issues but concerned about ethical restrictions or other pitfalls? Martha will discuss the latest technologies and how to use them most effectively and efficiently in marketing and online brand development. Doug will discuss security and ethical issues and online best practices.

Presentation Slides:

You can also find the slides on Slideshare: Beyond Linked In Advanced Social Media For Lawyers.

We also provided a handout full of information on useful sites and tools:
http://docs.google.com/View?id=dcnnt5b4_28jhgwr9gk

Social Networking Compliance

Think Before You Tweet!

What are the challenges for broker/dealers and investment advisers trying to use social networking sites?

Complinet hosted a webinar on this topic with Clifford Kirsch from Sutherland Asbill & Brennan LLP and Debbie Corej, Vice President, Compliance – Insurance Division, Prudential.

Clifford started the discussion by pointing out the need to think about who is using these communication tools and what they are using them for. There is not a single source for the legal rules on how to use social networking tools in compliance with the regulatory requirements. You have to fit these tools into the established regulatory frameworks.

Broker/Dealer

With respect to the supervisory structure, you should look at FINRA Rule 3010. You need a policy, whether you allow use of these tools or not. You should start by looking at FINRA’s Guide to the Internet.

The next focus is whether the tools are being used as advertising and sales literature. If so, then there are content requirements, filing requirements and reviews. There is new proposed FINRA Rule 09-55 that would streamline the approach to advertising. There is no specific reference to social networking. Many commenters did request some specific discussion of social networking.

Then next hurdle is record-keeping. Some site are easy to integrate with record-keeping. SEC Rule 17A-4 has extensive requirements.

Another issue is keeping track of complaints and filing complaints. That is hard to do in the free flow of information on social networking sites. What do you do if someone complains on Twitter?

Investment Advisers

As with brokers you still need a supervisory structure and examinations for risk. You should have a policy, pro or con.

With advertising and sales literature, the requirements are not as difficult as broker/dealers. There are no filing or pre-approval requirements. SEC Rule 206(4)-1 prohibits testimonials and selective discussion of past performance.

There are record-keeping requirements, so you need a system in place for preserving the records, even though they are created on a third party social networking site.

Real Life with Social Networking at Prudential

Debbie turned to some of the challenges in her organization. They have a big umbrella. Part of the challenge is controlling the technology itself.

Prudential does block some sites and is looking at ways to open access in a way they can control. There are competing interests in the company. Recruiters have a different use than marketing. Everybody has some need to use the tools to stay connected with colleagues and experts.

There are some vendors out there trying to meet the compliance requirements. But they are all new and untested. FINRA is not giving any particular blessing on a tool.

It is important that compliance understand the different features of a site and the terms and conditions for that site. Any one social social networking site is likely to have features that fall into multiple categories for compliance requirements.

For example, you should prohibit the recommendations feature of LinkedIn. You should have an internal person as a connection so that they get a notice of updates to profiles.

You need to have people submit correspondence for record-keeping internally and then review the account to make sure all of the correspondence has been submitted.

It is important to have a policy. It is also important that the policy is not freestanding but integrated with other policies, such as confidentiality. It’s possible that if you do not prohibit a tool, you may be implicitly allowing the use of that tool.

Of course you need to test compliance with the policies. If you are banning, you should search the site for employees’ names and your company name.

FINRA Task Force

FINRA has created a task force to look at social networking. (Debbie is on the task force.) FINRA is very interested in the topic and how the mechanisms can work in compliance. At the company-level it is easier to control and monitor than at the individual registered-representative level.

There is the problem of using the sites in personal level is hard to contain. What if a friend asks you a professional question?

FINRA is hosting a March 17 webinar: Compliance Considerations for Social Networking Sites.

One in Two U.K. Companies Block Social Networking Web Sites

fulbright trends

Fulbright & Jaworski, the international law firm, just published their 6th Annual Litigation Trends Survey Report. It is an independent survey of senior corporate counsel from a wide range of industry sectors.

About half of the respondents (52% of U.K. and 46% of U.S.) claim to block employees from accessing social networking Web sites. Two in five of all corporates (42%) block the most popular personal social networking sites (such as Facebook, MySpace and Bebo) and 30% block business-related networking sites (LinkedIn and Plaxo). The YouTube web site is also blocked by more than a third of companies (37%).

Only 1/3 of the companies reported that they have no restrictions on access. Technology companies are the least likely to block social networking sites, with 56% of all tech companies saying they have no restrictions on such sites.

I found it interesting that 18% of U.K. companies have been asked to produce electronic information from such web sites as part of an electronic discovery request in legal proceedings.

Melanie Ryan, a Fulbright partner, commented, “For some businesses, networking sites can provide an efficient platform for keeping up-to-date with the latest developments and maintaining a profile in their industry. For those businesses that block access, such benefits are outweighed by the possible legal risks, including the inadvertent disclosure of confidential or proprietary information and the resulting claims or fines imposed by their regulators – not to mention, the security threat to their IT systems.”

But do they have a policy in place to let employees know what they should not be doing on these sites? Or are employees just doing those bad things at home or on their iPhone?

Blocking is not an effective policy.

fullbright-findings

Facebook, Twitter, LinkedIn and Compliance: What Are Companies Doing?

SCCE policies

The Society of Corporate Compliance and Ethics and the Health Care Compliance Association conducted a survey among compliance and ethics professionals in late August 2009 to see what employers are doing about the use of these sites by their employees.

They got back almost 800 responses from their members using an online survey tool.

  • 50% of respondents reported that their company does not have a policy for employee online activity outside of the workplace
  • Of those companies that do have a policy, 34% include it in a general policy on online usage
  • Of those companies that do have a policy, just 10% specifically address the use of social network sites

“While the data indicates that many organizations have had to discipline employees for improper activity online, the fears may outweigh the actual risks. A survey asking about discipline regarding improper email usage would likely yield much higher numbers.”

Facebook, Twitter, LinkedIn and Compliance: What Are Companies Doing? pdf-icon

Social Networking for the Legal Profession

Social-networking-for-the-legal-profession

I just finished reading Social Networking for the Legal Profession by Penny Edwards and Lee Bryant. They were nice enough to send me a copy.

Penny and Lee used a few quotes from me, referred to some of my writings and used some of my social networking activity as examples. That poor judgment aside, the book is otherwise a great report on how legal professionals can take advantage of online networking tools.

The book contains practical examples and strategies. They explore the use of the tools externally as part of your marketing and business development efforts. They also explore the use of them internally for operations, communication, and knowledge management 2.0. They present a good road map with lots of options for an organization to chose among.

They start with the basics and run through a survey of the social networking sites most useful to lawyers: LinkedIn, Avvo, blogs, Facebook, Twitter, Legal OnRamp, Martindale-Hubbell Connected, JD Supra and many others.

It is not all kumbaya. The report takes into account the risks and challenges you must overcome to make implementation a success. They spend significant time talking about the culture challenges. They also explore the security, privacy and compliance issues.

Penny and Lee point out the paradigm shift with these tools. Unlike previous generations of collaboration tools, these 2.0 tools target individual benefits rather than the benefits to the organization as a whole. They focus on what’s in it for the individual. The benefits to the larger organization are a by-product. There is less emphasis on standardization and centralization.

The focus on standardization and the collective benefits was what knowledge management got wrong. The big central databases of knowledge management were useful to the organization as a whole, but provided little benefit to the individual contributor. They did not want awards or financial compensation (not that more money wouldn’t hurt), but wanted a way to help organize their own stuff in a way that was useful to them.

Unlike past generations of software, most of the innovation is coming from the consumer space. Free tools on the web are far ahead of enterprise systems. IT departments are constantly being asked why its so easy to search on Google or publish on the web, but so much harder to do so inside the law firm. If you want to know how these tools can help you inside your organization, you need to try them outside your organization.

There is a great chapter on the benefits of networking tools used inside the organization and how to achieve great benefits.

The book is expensive. The Ark Group gave it a cover price of £245. It is a great book and worth the price. If you are interested, I was given the details of a discount offer, taking $115 off the price, making it $285 plus $10 shipping. The details are on the US publicity flyer for Social Networking for the Legal Profession (.pdf).

You can read more from Penny, Lee and others at Headshift on the Headshift blog.

I thought I would also share links to some of my material that Penny and Lee cite in the book:

Top Ten Mistakes Lawyers Make with Social Media

social-media-expert

Lawyers and law firms are rapidly adopting social media to market themselves and connect with peers. These are new tools. We are all trying to figure out how to use them. Just to make it more difficult, the tools themselves are rapidly evolving as we are learning how to use them.

Some lawyers are doing a great job using them. Some are doing a terrible job.

I thought I would share my thoughts on the mistakes I see.

10. Blocking access. Social media provides a rich source of information about clients, potential clients, opposing counsel, witnesses and other parties. It easy to get around the block with a mobile device or home access. Blocking is just an annoyance. It’s not an effective policy.

9. Failing to have a social media policy. People in your law firm are using social media. They may only using if for personal purposes. But if they identify your firm as their employer, what they do has an effect on the image of your firm.

8. Ignoring Facebook as a recruiting tool. “You do better fishin’ where the fish are.” Many summer associates are creating groups on their own. Your firm would be better off if they administered the group.

7. Not giving authorship to blog posts. The attorneys writing the story should get credit for the story. This gives an attorney an extra incentive to contribute and showcases their skills.

6. Not linking. A blog is much more useful to its readers and its authors if it links to other relevant information. There is no reason not to link to primary source material like statutes and regulations online. Link to other news sources, websites and blogs. Yes people will leave leave your site through those links. But they are more likely to come back if your site is the better source of information.

5. Failing to understand ethical limitations. The bar regulators have barely dealt with web 1.0, never mind the additional issues around web 2.0. Keep in mind that most social media activities can be considered advertising.

4. Abandoning without notice. Nothing lasts forever. If you started a blog and are not posting any more. Put a post saying you’ve stopped or are on hiatus. (This is what I did for my old KM Space blog.)

3. Failing to leverage LinkedIn. You should have a profile in LinkedIn that has at least as much information as the bio on your firm’s site. You should also be leveraging LinkedIn to stay up to date with the movement of your clients and former client contacts. LinkedIn is a great source of information for CRM systems.

2. Posting information about clients. As with any advertising, make sure you get written consent from clients before posting any information about your work with them.

1. Not using social media. The biggest mistake most lawyers are making with social media is not using these tools.  They are here to stay. Get used to it.

What mistakes to you see being made?

Image is from Hugh MacLeod of Gapingvoid – “cartoons drawn on the back of business cards”: you’re a social media specialist?

The State of Legal Social Networking

I have been a long time fan of social networking for lawyers. Capturing the conversation among colleagues is one of the best ways of capturing knowledge and finding expertise. Connecting with peers is the best way to stay up-to-date on the law. That was one of the primary reasons that bar associations formed. Can these online networking opportunities be as effective as your local bar association? Are they worth your time?

Here is my take:

lexisnexis
Martindale-Hubbell Connected
11,359 members

Currently, this appears to be the biggest social networking site focused on the legal market. So they come first in this article.

Connected is in the position of being backed by large company with significant resources and lots of substantive legal content. The site’s focus has been on creating a trusted community and validating the identity of the user. This resulted in a lengthy and error prone process for joining the site. (They just revamped the process: New Registration Workflow Launches.)

There is very little substantive legal content. The lure of this platform has been the potential of harnessing the vast Lexis database of substantive legal information to the individual. So far that potential remains untapped. The downside of having a big company behind the site is the slow speed and legacy systems that hamper the development of the site.

There are not many discussions taking place in the platform. The few discussions are focused on social networking itself. They continue that trend by devoting the week of July 20 as Social Media Policy & Guidelines Week. An interesting topic, but it will be subject to the limited audience and participants in this site. The people I would look to for guidance on this topic are not users of the platform.

If you are interested in finding out more about social media policies, the discussions next week may be interesting. But there is much more information and discussion on this topic outside the platform.

legal-onramp

Legal OnRamp
9,242 Members

Legal OnRamp is the most innovative of these sites. It has vibrant conversations with people that I consider to be thought leaders in the business of law.

Legal OnRamp started with a focus on connecting in-house counsel with each other and giving them a platform to collaborate. Then they started allowing private practice lawyers into the platform to help with the collaboration and sharing of information.

Certainly, I joined and contributed because the platform was full of in-house counsel. At the time I joined, I was a private practice real estate lawyer. I stood out as real estate lawyer when most of the other members were focused technology practices and at technology companies. That quickly changed as the membership base grew.

The site does have robust content on substantive legal topics. They require private practice lawyers to submit FAQs on legal topics or otherwise contribute to the content and discussion on the platform. Failing to contribute gets you kicked out of the platform.

I was feeding my old blog (KM Space) into the platform. Now this blog is fed into the platform. It’s interesting to see more robust conversations take place inside Legal OnRamp than on the originating blog itself.

One of the mantras of Legal OnRamp is that the practice of law is changing, so you would expect lots of discussion about how the practice of law changing and how it should change. There are. I would prefer to see more conversation about substantive legal issues. The conversations are interesting. I would just prefer some different conversations.

Legal OnRamp also recently joined forces with the Corporate Executive Board to bring new resources to law department members of the General Counsel Roundtable, a program of the Corporate Executive Board.

legally-minded
Legally Minded
2,000 members

There is very little activity other than new users adding their profiles. This platform is sponsored by the American Bar Association so there was much hope that this site would be able to tie into the big store of information that the ABA holds. So far, that does not seem to be the case. The other thought would be to move some of the email discussion list-serv to the platform. That did not seem to happen.

That leaves the platform as a wasted opportunity by a large legal organization.

lawlink
LawLink
5,000 Members

This platform claims to be the first social network for the legal community. I had not been to the site for months until the recently launched a Twitter Forum, pulling in Tweets from members. Other than this new forum, there is not much activity here. Being first does not make you the best.

LinkedIn-Logo

LinkedIn
88,284 Lawyers
291,500 Attorneys
324,168 listed as being in Legal Services.

Obviously LinkedIn is not limited to the legal community. But there are hundreds of thousands of lawyers and legal industry professionals using the platform to stay connected. For years, LinkedIn groups were merely badges to add to your profile. Now they are robust communities with lots of discussions and news being shared.

The groups rival the size of the legal specific platforms above. For example the Patent Law Group on LinkedIn has almost 4,000 members. The limitation is the inability to collaborate and store information in the group.

Compliance and Recommendations on Social Networking Sites

View Doug Cornelius's profile on LinkedIn

I am an enthusiast of social networking sites and web 2.0. But I realize they have limitations and dangers. I have been very concerned about the Recommendations feature in LinkedIn. That feature allows any of your connections on LinkedIn to post a recommendation or endorsement about you that appears on your profile page.

At first, that seems great. Since the one view of LinkedIn is that it operates as an online resume, posting recommendations is a smart feature. But what if you are in a regulated industry? Many professions have limitation on what they can say in advertisements and what they can say about their services.

I took a look at how recommendations are regulated for investment advisers and for lawyers. Two areas that affect me the most.

If you a registered investment adviser, you are subject to Rule 206(4)-1:

a. It shall constitute a fraudulent, deceptive, or manipulative act, practice, or course of business within the meaning of section 206(4) of the Act for any investment adviser registered or required to be registered under section 203 of the Act, directly or indirectly, to publish, circulate, or distribute any advertisement:

(1) Which refers, directly or indirectly, to any testimonial of any kind concerning the investment adviser or concerning any advice, analysis, report or other service rendered by such investment adviser. . .

It looks like recommendations are prohibited in an “advertisement.” The definition of “advertisement” is broad:

b. For the purposes of this section the term advertisement shall include any notice, circular, letter or other written communication addressed to more than one person, or any notice or other announcement in any publication or by radio or television, which offers (1) any analysis, report, or publication concerning securities, or which is to be used in making any determination as to when to buy or sell any security, or which security to buy or sell, or (2) any graph, chart, formula, or other device to be used in making any determination as to when to buy or sell any security, or which security to buy or sell, or (3) any other investment advisory service with regard to securities.

Is your LinkedIn profile an “advertisement” under this rule?  If you state that you offer investment advisory services on your LinkedIn profile, then I think it is an advertisement. So you should not have recommendations.

What about lawyers? The first problem is that every jurisdiction has a different set of rules about attorney advertising. You need to take a look at the rules in your jurisdiction.

First look to the ABA Model Rule 7.1:

A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. A communication is false or misleading if it contains a material misrepresentation of fact or law, or omits a fact necessary to make the statement considered as a whole not materially misleading.

Under this rule, you could have a recommendation as long as does not have a material misrepresentation and is not misleading. That gets you into gray areas very quickly.

This is just a model rule. Every state is different. For example, Arkansas[Rule 7.1 (d)], Florida [Rule 4-7.2(c)(1)(J)], Indiana [Rule 7.2(d)(3)], South Carolina [Rule 7.1(d)], and Wyoming [Rule 7.2(h)] all explicitly prohibit any kind of testimonial in attorney advertising. Nevada, Pennsylvania, California, Louisiana, Missouri, New York, Oregon, South Dakota, Texas, and Virginia have limitations on what can be said in a testimonial or a disclaimer that needs to be present.

What do I think? Keep recommendations off your LinkedIn profile.

See: