Popular financial blogger Bill Winterberg, CFP, feels financial advisors who use the social networking site LinkedIn.com with its link for "recommendations" may be violating SEC regulations against soliciting or using testimonials in any way.

Several advisors have informed Winterberg that they already have removed the "recommendations" link from their LinkedIn page. SEC regulations prohibit financial advisors from using any testimonial about themselves or their advice.

"I have not solicited the SEC for an opinion on the matter, but I believe that Rule 206(4) of the Investment Adviser Act of 1940 is very clear. I think it would be easy for an SEC examiner to determine that LinkedIn recommendations violate the rule," Winterberg says.

"The advisors and financial planners who have contacted me, either publicly by posting blog comments or privately by e-mail, are thankful that I brought this issue to their attention," he adds. "Most advisors take compliance very seriously, but many are faced with the challenge of interpreting the reach of rules, particularly when applied to the rapid development in social networking."

Winterberg posts comments on technology insights for the financial planning community on his blog at Financial Planning Pad.

In his original blog post, Winterberg explains, "As LinkedIn becomes increasingly ubiquitous in the social networking space, I see more and more investment advisors that have set up profiles on the site. A LinkedIn profile not only helps advisors connect with other advisors and colleagues, but it can also attract prospects and potential clients searching for a qualified advisor."