Regulators Propose Social Media Rules for Lenders
Federal regulators have proposed guidelines for financial institutions when they market mortgage products on social media Web sites.
The 31-page proposal was issued by the Federal Financial Institutions Examination Council.
“Financial institutions may use social media in a variety of ways, including marketing, providing incentives, facilitating applications for new accounts, inviting feedback from the public, and engaging with existing and potential customers, for example, by receiving and responding to complaints, or providing loan pricing,” according to the guidelines. “Since this form of customer interaction tends to be informal and occurs in a less secure environment, it presents some unique challenges to financial institutions.”
The proposal contains a range of guidelines, such financial institutions complying with the advertising provisions of the Truth in Lending Act and disclosing loan terms and costs when they advertise loan products on social media. These companies also should display the Equal Housing Opportunity logo on their Facebook page when referring to residential mortgage lending.
Financial institutions should also have a risk management program to identify, measure, monitor, and control risks related to social media.
Public comments are being accepted on the proposal for 60 days before moving forward with its adoption.