Laws enacted by states to ensure workers’ privacy on social media sites like Facebook and Twitter are under attack by regulators and the financial services industry. The laws, already enacted by five states and under consideration in many more, are intended to prohibit companies from monitoring their employees’ social media accounts to prevent invasions of privacy. But regulators like FINRA and groups like SIFMA and FSI are lobbying for exemptions — so far, to no avail. Unlike telephone companies, social media providers are required to build capabilities for authorities to monitor their systems.
Federal agencies like the FBI often approach social media sites with mixed results, and there is no case law that rules on such issues. Stay tuned as broker dealers and RIAs face the tough decision of either following state laws or violating financial service rules and obligations to monitor their reps’ social media accounts.
