Avoid social media compliance pitfalls
Know the rules on advertising promotional rates.
Kristen Tatlock says her social media use primarily involves posting pictures of her puggle, Kiki, and conveying happiness or sadness for her favorite sports teams. But the senior compliance manager at CU Service Network shares her thoughts on social media and what compliance regulations credit unions need to pay attention to.
When did social media compliance become a big issue, and how has it evolved?
Tatlock: It started to come to the front probably five or six years ago. Initially, credit unions used social media, primarily Facebook and Twitter, to get the word out about themselves. As they grew more comfortable with social media, the ways credit unions used it started to evolve simply beyond “here’s what we are and here’s why we’re special.”
We were among the first compliance consultants to talk about social media and advertising when credit unions’ use of social media went beyond basic information about the credit union and its work in the community. As the number of social media platforms has continued to grow, so has credit unions’ use of social media to advertise specific products and services.
‘As social media has evolved, credit unions’ use of it has evolved as well.’
Do different social media platforms have different risks?
Tatlock: The risk is pretty much the same regardless of whether you’re talking about Facebook, Twitter, Instagram, SnapChat, or Pintrest, but it’s important to remember that each of the platforms have their own rules for use. A lot of people tend to forget that.
What are some common mistakes credit unions make with social media?
Tatlock: A common error is when credit unions are advertising promotional or introductory rates on credit cards, they don’t include how long that rate will be in effect or the rate after the promotional period. Under Regulation Z, those disclosures also have to be in “close proximity” to the promotional or introductory rate.
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Advertising rules have failed to evolve as quickly as technology.
Another common error we see is the misuse of “one clicks.” Under some regulations, if there are disclosures required to be made in an advertisement, those disclosures can be one click away. But the link to those disclosures must be clearly marked.
With social media, a hyperlink isn’t always identifiable. So, if the disclosures are going to be one click away, the reader has to know that they need to click the link for additional information.
How will social media compliance risks evolve in the future?
Tatlock: Advertising rules have failed to evolve as quickly as technology has. At the pace which social media platforms are being developed and as credit unions expand the platforms they use, it’s going to provide exposure for potential violations.
Credit unions need to understand not only the rules and regulations regarding advertising, but the specific rules, regulations, and terms of service that each platform has. Part of managing the risk is making sure you understand what the rules are for the particular media or platform that you’re going to use.
Are you an avid social media user?
Tatlock: I pretty much stick to Facebook and posting pictures of my dog Kiki, who is the cutest puggle in the world. I use Facebook to express my joy or sadness on how my sports teams are doing.