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3 Best Practices to Avoid Social Media Compliance Snafus

From government agencies to pop culture icons and penny stock fraudsters, organizations and people alike have paid the price for social media missteps. In the recent past, social media communications compliance represented a bit of a gray area. Today, new regulations exist that govern specifically the use of channels like Twitter and Facebook as vehicles for distributing information to a public audience. Organizations that aren't aware of, and don't follow, new social media-related guidance are destined for trouble.

Late last year, the Environmental Protection Agency (EPA) violated federal law when it used social media to promote support for an Obama ruling. Federal laws prohibit government agencies from lobbying and distributing propaganda. In the EPA's case, the Government Accountability Office found the agency to be in violation of those laws. This story is not unique to the EPA, or to government agencies in general. There exists a number of other cautionary tales about organizations or individuals, purposefully or otherwise, using social media in ways that violate laws. The anecdotes are a reminder that organizations, regardless of industry, must adhere to regulations that govern how they are able to use social media. Following are more stories about social media mishaps and best practices organizations can use to ensure they remain compliant.

In August 2015, Kim Kardashian made quite the splash when she partnered with Duchesnay USA to promote its morning sickness medication, Diclegis, on Instagram. The Food and Drug Administration's (FDA) draft guidance for social media compliance states that:

Unfortunately for both Kardashian and Duchesnay, the social media queen bee's post failed to mention any of the risks associated with the drug. The FDA sent Kardashian and Duchesnay cease and desist letters, which warned that a failure to correct the promotional material would result in "regulatory action, including seizure or injunction." Now, a proverbial slap-on-the-wrist letter isn't exactly an example of the regulatory body coming down hard on violations, but the notice provides an idea of what organizations must be wary of when using social media -- especially where third parties are concerned -- to promote products.

The Security and Exchange Commission (SEC) has also had its hands full dealing with errant social media posts. In November 2015, James Alan Craig created two Twitter accounts made to mimic those of securities research firms. From those accounts he tweeted false information about two companies, causing share prices of both companies to fall and costing investors more than $1.5 million. Craig's actions were in violation of the section of the Securities Exchange Act of 1934 that seeks to prohibit insider trading. In particular, Craig "engage[d] in... fraudulent, deceptive, or manipulative acts or practices, in connection with... security holders." While Craig's offense didn't break laws that specifically relate to social media use, his actions (and subsequent criminal lawsuit and permanent injunction against) show that social media posts are considered even in cases in which regulatory bodies, like the SEC, preside.

Regardless of the circumstance, it's clear that social media plays a crucial role in lawsuits involving regulatory guidance. Organizations that fall under the scrutinizing eye of bodies like the EPA, FDA, SEC, and others, must implement social media policies and practices that ensure their employees' behavior falls within their respective regulatory body's social media guidance. To fulfill social media compliance, organizations can take the following steps:

Social media is becoming an increasingly ubiquitous form of communication, even in corporate settings. When a lawsuit is concerned, regulators around the world consistently view social media as just another form of communications. Organizations ought to treat it as such. Indeed, existing rules around record-keeping, advertising, and supervision all apply to corporate communications, and many regulatory bodies are implementing social media-specific guidance, as outlined above. In today's business compliance landscape, social media content is determinative in cases like those of the EPA, Kim Kardashian, and James Alan Craig. Organizations must take the proper steps to ensure social media content helps them and doesn't hurt them.