Addressing the Specific Challenges of social media

in Financial ServicesAlpesh Doshi

Fintricity

Agenda

Introduction to the Social Media Landscape

Regulatory and Legal Issues

Managing Risk in the Social Media World

What is Social Media?

It’s about ........ Interaction

It’s about ........ Collaboration

It’s about ........ Content Sharing

Social Media is an attitude not a technology. It’s about enabling and encouraging participation through open applications and services.....Ian Davies (http://iandavis.com/blog/2005/07/talis-web-20-and-all-that )

Social Media LandscapeLarge and growing social media applications

Consumers across the demographic (18-40)

Financial Applications starting to emerge......

Social Networks are becoming a part of daily life

Social Media Landscape

SOCIAL MEDIAWEB 2.0 - UGC

RSS

P-to-PLending

PFM

Podcasts

Photo/ VideoSharing

Widgets

MicroBlogging

CustomerReviews

BloggingSocialNetworking

Inspired by the McCann Social Media Tracker Wave .3

VirtualWorlds

PredictiveMarkets

How is this relevant to Financial Services?

Finance sites are sprouting everywhere....

Really lead by US (although regulation is different)

Social Media sites provide online tools and services to manage finances

Why use Social Media?Engage and Interact with Customer

To help Marketing and Brand Development

Build Trust in your Brand

Social Networks Applications

Understand needs and drivers of consumers

Driver loyalty and advocacy

Input to Product Development

Blogs

How

?

Monitor

Legal and Compliance Issues

FSA Regulatory Issues

Liability Issues

Privacy Issues

Regulatory OverviewFinancial Services and Markets Act 2000

Regulates Advertising of financial products

Conduct of Business Source Book (COB) 4

Clear, fair and not misleading

Warnings on Past & Future Performance

Specific Information when a direct offer is communicated

FSA Remedies - recap

FSA can require amendment of a promotion

Require an Advertiser to contact customers

Fine and publicly name offenders

Risk Assessment and Management

When is the use of Social Media considered to be promotion?

Case by Case basis

Where does the content come from? UGC or not?

Role of Compliance to answer

Legal Protection

It’s a new business world, but same legal principles

Involve compliance at design stage

Not just the wording but design and structure

Anticipate future uses

Liability Issues

Employers’ vicarious liability

Offences

Defamation

Discrimination

Insider Trading

Tipping Off

Legal Risk Management

Anticipate potential risks

Use and take down policy

Role of Community Managers

Employee use Policy

Overview of Privacy Legislation

Data Protection Act 1998

Regulates processing of personal data

Meaning of Personal Data?

Meaning of Processing?

Overview of Privacy Legislation

Who is the Data Controller?

What are its legal obligations?

Obtaining Consent (from the data subject)

Information to be provided to subjects

Security

New Privacy Guidance

Article 29 Working Party

Specific Guidance on Social Network Providers

Best Policy Recommendations

Warning to Users regarding privacy risks when uploading information

Reminder to users if uploading other individuals’ data, they need consent

What should you do about Privacy?

Need for specialist privacy guidanceRole of consent and privacy policy

Importance of Security (protecting user data from other sites)

A security model must be put around services

ConclusionsSocial Media is already here!Brands are keen to reach their customers and learn more about them

Conversations and Interactions are common outside financial services

Driven by brand, transparency, interaction

New business world same legal principlesNeed to involve legal and compliance from design stage

Monitor use of social media and social networks

Use of terms and user policies

Thank you• web: www.fintricity.com• mobile: +44 7973 822820• email: alpesh.doshi@fintricity.com• blog: www.alpeshdoshi.com• twitter: www.twitter.com/alpeshdoshi• skype: alpeshd• linkedin: www.linkedin.com/in/alpeshdoshi