Legal News

SEC Clarifies Rule on Posting Company Data on Social Media
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

On Tuesday, the U.S. Securities and Exchange Commission said that companies can use their social media accounts like Twitter and Facebook to make vital announcements, as long as they informed their investors the sites which will be used by them to release such data. The clarification would help companies fully utilize their social media channels and extend their reach to investors.

The clarification followed the inquiry into a post made in July 2012 by Neflix’s chief executive, Reed Hastings. The purpose of the SEC investigation into the Netflix case was to find out whether the announcement made by Reed Hastings on his personal Facebook page had violated rules of releasing key data to all investors at the same time.

On Tuesday, the SEC also confirmed that it did not find sufficient ground to allege any wrongdoing in the Netflix CEO Facebook post. However, during the investigation, the SEC found that its staff was uncertain about the application of disclosure rules to social media.

  
What
Where


George Canellos, the acting director of the SEC’s enforcement division said in a statement that, “One set of shareholders should not be able to get a jump on other shareholders just because the company is selectively disclosing important information.”

Canellos further said, “Most social media are perfectly suitable methods for communicating with investors, but not if the access is restricted or if investors don’t know that’s where they need to turn to get the latest news.”

At issue is the Reg FD or Regulation Fair Disclosure of the SEC which has often been criticized by companies as being outdated and caught in a time warp while social media revolutionized the way news was shared in the world.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




Under the new guidelines by the SEC, companies can notify on their websites and in press releases that they will be using social media to make announcements and on which pages.





 

RELEVANT JOBS

Trust and Estate Litigation Attorney

USA-CA-Los Angeles

Hagen O’Connell & Hval LLP is seeking to hire an experienced Estate / Trust litigation attorne...

Apply now

Trust and Estate Litigation Attorney

USA-WA-Seattle

Hagen O’Connell & Hval LLP is seeking to hire an experienced Estate / Trust litigation attorne...

Apply now

Personal Injury Litigation Attorney

USA-CA-Los Angeles

Job details Salary $60,000 - $80,000 a year Job Type Full-time Number of hires for th...

Apply now

Legal Assistant Paralegal

USA-IL-Evanston

We are seeking a legal assistant or paralegal that is interested in finding a longstanding, professi...

Apply now

BCG FEATURED JOB

Locations:

Keyword:



Search Now

Liability Defense Attorney

USA-FL-Fort Lauderdale

Ft. Lauderdale office of our client seeks liability defense attorney with 3+ years of insurance defe...

Apply Now

Litigation Associate Attorney

USA-CA-San Francisco

San Francisco office of a BCG Attorney Search Top Ranked Law Firm seeks litigation associate attorne...

Apply Now

Senior Family Law Associate Attorney

USA-CA-Murrieta

Murrieta office of a BCG Attorney Search Top Ranked Law Firm seeks senior family law associate attor...

Apply Now

Most Popular

SEARCH IN ARCHIVE

To Top