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How to Create Great Finance Content Without Violating FINRA Regulations

By Janet Al-Saad September 21st, 2015

Creating great content is hard enough on its own, but doing it with regulatory agencies scrutinizing your every move can undermine marketers before they even have a chance to get started. On one hand, brands like Denny’s and Totino’s have no problem publishing outlandish content, and on the other, financial services providers seem to struggle just to get approval for a simple blog post.

Until recently, the traditionally old-school finance industry had trouble keeping up with the proliferation of new media. The esoteric reporting regulations from the Financial Industry Regulatory Authority (FINRA) impeded even the most forward-thinking firms from publishing.

But today, even the most conservative of firms are realizing the value of new media in their broader marketing strategies. While FINRA can still create a cumbersome operating environment for financial services firms wishing to produce regular content like newsletters, blogs, social media, or emails, there are several best practices that firms can rely on to streamline the content creation process.

FINRA rule 2210, and why you need to understand it

When trying to figure out how to set up a workflow that satisfies all FINRA regulations, it helps to first try to decipher the legalese. FINRA rule 2210 is the principal regulation governing communications with the public, including retail and institutional investors.

The rule defines three principal classes of communications:

  • Correspondence: any written communication (including electronic) made available to 25 or fewer retail investors made available during any 30-day period.
  • Institutional communication: any written communication (including electronic) made available solely to institutional investors during any 30-day period.
  • Retail communication: any written (including electronic) communication made available to 25 or more retail investors during any 30-day period.

It’s essential for anyone who wants to build a content workflow to understand the nuances of these regulations. For example, should a retail communications specialist in charge of social media also write economic commentary? Should contributors only stick to one role? And who has the bandwidth to manage correspondence?

These are a few of the questions that every financial services company needs to address when setting up or restructuring a content marketing program.

Approve with flexibility

Publishing financial content often requires a supervisory system involving designated people within the firm having approval powers. Whether your firm uses one or many principals depends, in part, on what type of content you want to produce.

For example, when I worked for a major global asset manager, there were separate principals for institutional and retail communications, since each line of business had its own marketing team. However, when I worked for a much smaller trading firm, all communications were approved by a single principal due to our exclusive focus on trading. We simply didn’t have a need for much retail communication or correspondence.

It’s also important to recognize that ongoing regulatory changes can impact your firm’s approval processes. For example, FINRA’s most recent guidance on social media significantly reduces the need for a maze of compliance for any communication that takes place on an interactive electronic forum1.

This adjustment has had a huge impact on content distribution because financial publishers are now capable of promoting their content quicker while it is still timely. Back in 2011, when the major asset manager I worked for started producing social media posts for retail investors, the new medium led to confusion regarding supervisory and reporting requirements. Since then, however, FINRA Regulatory Notice 12-29 has clarified recommendations on social media compliance, making it so that social media managers no longer need pre-approval for their posts.

To stay on top of these changes, it helps to maintain strong communications with FINRA via regular, direct contact so you can notify your compliance team as soon as possible.

Double down on what works and avoid self-promotion

Though supervisory and reporting requirements may seem overwhelming at first, many financial services firms are able to comply over time, minimizing gridlock by refining their workflows. One of the surest ways to become an efficient financial publisher is to focus on content formats that have already been successful for you in the past.

In addition to social media posts, content that doesn’t recommend any particular product or investment strategy has fewer FINRA restrictions, which makes it a potential boon for finance marketers and gives them incentive to brainstorm story ideas that aren’t self-promotional.

It’s worth pointing out that when a new firm decides to produce marketing collateral and registers with FINRA, it may face increased scrutiny during its first year. According to Rule 2210’s record-keeping provisions, marketers are supposed to file their work with FINRA at least 10 days before publishing any retail communication. That level of regulation can make it really challenging to publish at the speed of news, but it’s important to use this period as an opportunity to develop a strong working relationship with FINRA based on trust.

The process of working with FINRA can also make it easier for you to arrange story templates and educate content creators on editorial protocol like modifying language to avoid investment guarantees.

Creating financial content is always going to be a complex task that requires precise communication. But instead of looking at FINRA as an inconvenience, smart marketers will work with regulations to establish the best workflows possible. Banks and other investment firms will probably never operate with the freedom of Denny’s, but that doesn’t mean they can’t be exceptional publishers in their own right.

Note: This information in this article is not intended to constitute legal advice and should not be relied upon in lieu of consultation with appropriate legal advisors.

  1. Basically, any social media update on Facebook, Twitter, etc. where users can comment or engage with a post
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