Morgan Stanley Smith Barney to shed reps' social media shackles

Morgan Stanley Smith Barney, the world's largest brokerage, will let financial advisers market themselves and share ideas with clients through social- networking websites LinkedIn and Twitter. The plan will start with about 600 advisers in late June before expanding to the rest of the firm's 17,800 brokers within six months, according to an internal memo from Andy Saperstein, who runs the brokerage's U.S. operations. Jim Wiggins, a spokesman for New York-based Morgan Stanley, confirmed the contents of the memo. Wealth-management firms have been seeking ways to allow brokers to use social media sites that are popular with customers while satisfying regulatory demands that client communications be captured and retained. Morgan Stanley brokers will have communications pre-approved and the firm will keep records of them, according to the memo. “This will be a significant competitive advantage,” Mr. Saperstein said in the memo. “We are the first major wealth- management firm to announce a vendor solution for our advisers to use key social-networking sites to market themselves and share the firm's intellectual content.” Scores of brokerages have shied away from social media because of a host of compliance reasons, even though Finra unveiled formal guidelines for social media and blogging more than one year ago. According to InvestmentNews' recent independent broker-dealer survey, however, 71% of the nearly 100 IBDs polled now permit their advisers to use social media for professional purposes. To see the complete list of these 100 broker-dealers, and whether they allow social media use, click here. In the full Morgan Stanley memo, which was published hereon the New York Times' DealBook blog, Mr. Saperstein noted that MSSB reps will also be provided with a specific tool that will allow them to share certain information. "In addition to the compliance component, we will also have a tool for Advisors to distribute Firm approved research and content, providing you with a powerful way to share our unique intellectual content with clients and prospects. You will have the ability, with the click of a button, to share pre-approved “status updates” or “tweets” with your social and professional networks," he wrote. --Bloomberg News, which additional information from InvestmentNews