The Financial Industry Regulatory Authority on Thursday spelled out more clearly how brokers may use social media.

In January 2010, Finra issued a regulatory notice providing guidance on its rules regarding how brokers may use social media to communicate with the public. Since then, Finra noted, firms have raised more questions on the application of the rules. Today's notice responded to some of these questions.

Among the clarifications described today:

A registered principal must review any social media site that an associated person intends to use for a business purpose, and they must review it in the form in which it will be "launched."

Participating in an interactive electronic forum is considered a "public appearance" and does not require prior approval by a registered principal, but firms must have procedures in place so they can review such participation after the fact to make sure such communication doesn't violate Finra or SEC rules.

Unlike communication on interactive forums, "static" posts -- such as blogs or other writing on Web pages -- are considered "advertisements" and must be approved by a registered principal before they are posted. 

Data feeds into a Web site need to be regularly reviewed and any inaccurate information needs to be corrected.

Brokerage firms must keep records of all communications pertaining to business, even if they are made on a personal device such as a laptop or smart phone.

Brokerage firms and associated persons may not sponsor a social media site or use a communication device that includes technology that automatically erases content.

A firm must conduct appropriate training and education concerning its social media policies, and must follow up on "red flags" that may indicate that an associated person is not complying.

A person affiliated with a broker-dealer may respond to a business-related question, such as one about a security, that's posted on his or her Web site, provided that the b-d doesn't have policies prohibiting such participation. If a firm has a policy that associated persons may not use a personal social media site for business purposes, then a substantive response by the associated person would violate this policy.

A firm that co-brands any part of a third-party site, such as by placing the firm's logo prominently on the site, is responsible for the content of the entire site. Under these circumstances, Finra considers the firm to have adopted the content on that site.

Firms may link to another site and aren't responsible for content at that site, as long as the firm doesn't "adopt" or become "entangled" with the content there and doesn't know or have reason to know that the site contains false or misleading information.