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At issue is the Reg FD or Regulation Fair Disclosure of the SEC which has often been criticized by companies as being outdated and caught in a time warp while social media revolutionized the way news was shared in the world.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

Paralegal / Legal Assistant

USA-NY-Staten Island

STATEN ISLAND PLAINTIFFS PERSONAL INJURY LAW FIRM IS SEEKING A FULL TIME/PART TIME PARALEGAL/LE...

Apply now

Attorney

USA-WA-Walla Walla

When the COVID crisis hit our state, we continued serving clients in our community. We are...

Apply now

Associate Attorney

USA-FL-Orlando

A/V Rated Downtown Orlando Law firm of Fisher Rushmer, P.A. is seeking an associate with 2 - 6 years...

Apply now

Legal Extern / Litigation Law Clerk

USA-VA-Alexandria

Old Towne Associates, P.C. (Alexandria, VA) Legal Extern Openings - Class of 2021 and 2022 ...

Apply now

BCG FEATURED JOB

Locations:

Keyword:



Search Now

Mergers and Acquisitions Associate Attorney

USA-CA-San Diego

San Diego office of a BCG Attorney Search top ranked law firm seeks Mergers and Acquisitions Associa...

Apply Now

Senior Wealth Management Group Associate Attorney

USA-CA-San Diego

San Diego office of our client seeks Senior Wealth Management Group Associate Attorney with 9 years ...

Apply Now

Bankruptcy Associate Attorney

USA-CA-Los Angeles

Los Angeles office of a BCG Attorney Search top ranked law firm seeks Bankruptcy Associate Attorney ...

Apply Now

Most Popular

SEARCH IN ARCHIVE

To Top