The Dos and Don’ts of Social Media for Compliance Teams and Loan Officers

By Melissa Grindel

You want your Loan Officers to earn more business and social media is a great way to do that. But how do you make sure they are not doing more harm to your institution than good? Social media is so woven into the fabric of our lives, it is easy to forget that while it feels casual, for the mortgage industry, it is anything but. The rules that apply in the more formal communication channels also apply to our LinkedIn, Twitter, and even Facebook discussions.

The ease with which Loan Officers can find people interested in your products, and those same people can find you, is a large part of the appeal of social media. Clients and potential customers feel at home on these platforms and so do we. But for Loan Officers and the compliance team charged with monitoring them, the relaxed standards Loan Officers may fall into when communicating on Twitter and not via email, can invite trouble. Sometimes, they need reminding that whenever talking about business, the regulations should never be far from their mind. The regulations protect the consumers, but they also protect your business.

So how can your compliance team help your Loan Officers successfully navigate the social media landscape?

DO train your Loan Officers how to use social media responsibly

  • Have clearly defined policies and procedures and refer to them often.
  • Make sure your LOs know the proper channels for approval of postings, or who to go to when a questionable request comes through social media channels. This can eliminate many problems early on before they become a risk to your company.
  • Direct your LOs to the Marketing Department at every stage of their online outreach. The marketing team regularly represents your institution to the customers; they know the applicable regulations. Many mishaps can be avoided just by having another set of eyes to look at an advertisement or post.
  • Have your Marketing Department draft pre-approved messaging that can be used by LOs to minimize an advertising risks with examiners.

DON’T take a wild west position with your company’s social media image

  • Do not cherry pick your monitoring: looking at only 10% of accounts each month opens your firm to more risk
  • Do not let Loan Officers make untrue statements about your company’s offerings
  • Content should be created and approved by the Marketing and Compliance Departments, not the Loan Officers
  • Do not assume that social media training is a one-time thing; periodically train your sales teams and audit often
Follow all social media profiles that pertain to your institution

If any employees are using social media to talk about the products or services offered by your institution, either at your behest, or on their own, follow them. On LinkedIn, finding your Loan Officers is fairly standard. Search their name, or even just your company name and you should be able to find them. Theoretically, Facebook is the same since they have a real name policy (as part of the terms of agreement users agree to use the name they go by in everyday life.) For Twitter—good luck, and god speed. To get around impediments like this, some social media accounts are owned and issued by the financial institution themselves, which makes monitoring for compliance violations much easier. Many companies are now requesting for employees to share social media handles as part of the hiring arrangement. Though these policies make monitoring easier, there is also plenty of push back on this initiative based on privacy concerns. Some states have outlawed this practice altogether.

Regardless of how a Loan Officers social media profile came to be, you should have written policies and procedures for social media use as it pertains to work. Within the policies it should be clear that any postings by employees pertaining to products or services offered by your institution, even under a personal social media profile, are subject to the same regulations as if the company posted. To make sure your LOs are in compliance, the compliance team should be monitoring all known accounts. It only takes one post with a violation for an examiner to issue a citation.

Know what your Loan Officers are saying to clients online

To be effective, monitoring must be thorough and consistent. Set up and adhere to a regular monitoring schedule. Monitoring accounts the institution owns is relatively easy to do. Individual accounts for multiple employees on multiple platforms may be best monitored by a third party rather than in-house. The frequency with which monitoring must be done to ensure compliance can make the task daunting, especially if your staff is lean. If you are thinking you can get away with checking less, think again. Given the speed at which social media works, just monitoring a portion of accounts monthly is an insufficient practice. However, outsourcing may allow for greater frequency and has the added advantage of freeing the Marketing and Compliance Departments up to fulfill other duties.

Be prepared for issues that may arise

Unwittingly, LOs often post with references to the amount or percentage of a down payment or the amount of a finance charge, without including required disclosures. Posts such as these would be considered advertising and in violation of the Truth In Lending Act (TILA) regulations if that post does not include the required disclosures. One wayward post could lead regulators to issue an action, leaving a public mark on your company.

Loan Officer profiles may be found to be incomplete, such as missing a NMLS ID, company address, or additional state licensure, among other things. Examiners may issue warnings and demand corrective action for these profiles.

Your firm should not only be checking for compliance violations on the part of your LOs, but also monitoring social media for fraud or defamation. Criminals are adept at recreating legitimate sites, also known as spoofing and financial institutions are a prime target. It is easy to steal from consumers if they willingly hand over their account number and PIN on a site they mistakenly believe is yours. Regularly scanning all social media platforms for your company names and trade names will allow you to flag the profile on the platform to have the offender removed.

Defamation can be trickier to spot (and handle). When people are dissatisfied, our hope is that they will come directly to the institution, but sometimes disgruntled clients post their grievances (real or exaggerated) on social media sites. Regular scanning for mentions of your company name allows your customer service team to offer resolutions and mitigate harm to your brand name.

Used properly, social media is a great tool for finding new clients and maintaining current ones. This emerging new world of online advertisement comes with regulations that hold your firm to a certain standard. But fear not, ActiveComply can ease your monitoring burdens. We scrub internet for accounts and make monitoring a breeze with our online software platform.

Harnessing the power of social media while limiting the harm that can come from it, makes great business sense. Post away, with these suggestions in mind and contact us to learn how our software can bring you solutions!