Well, I was wrong.
On October 11, 2009, Amar Toor wrote a piece at Switched.com that got me thinking. Amar was describing the danger that social media poses when tweets and other social media conversations erupt into character defamation lawsuits. Amar gave several examples involving Courtney Love, Demi Moore, Perez Hilton and others. The point Amar was making was that the widespread and viral nature of the unregulated social media industry can result in a battle between free speech and defamation that could create legal headaches.
That's the part that got me thinking. As banks continue to adopt social media as a communication channel, bankers need to ensure that their employees are well versed in terms of what can, cannot and should not be said. To further complicate matters, many banks have a social media presence without knowing it in the form of employee blogs, Facebook and MySpace pages, etc. In these cases, the employees may not understand the potential risks associated with their activities and that statements made by them may be attributed as comments of the company they work for.
But even "officially" sanctioned community managers may create legal firestorms. For example, take a tweet that asks a banker at Bank Y what he thinks about Bank X. If the Bank Y employee is not factual, Bank X may take a negative comment as derogatory and detrimental to Bank X's brand. The result could be wasted dollars and energy over a simple statement.
Does this mean banks should not encourage the use of social media. Absolutely not! Even if a Bank forbid it, chances are it would still occur at some level. Instead, every bank, whether active or not in social media, should develop a social media policy.
The policy should address not only the regulatory requirements but should also address how employees can characterize their competition. For example, an employee may receive a tweet regarding Bank Y's assessment of the financial condition/capital adequacy of Bank X. The banker should refer out the question to the FDIC site for that bank's financial condition rather that provide an opinion - particularly if the opinion is not positive.
It's too easy to think of social media as merely a marketing/outreach tool and forget its regulatory/legal implications. Good policy and training are the keys to protecting a bank from legal troubles. Also, be sure to read my post on Pain Free Social Media Policy Development.