Communications with the Public
Regulatory Obligations
FINRA Rule 2210 (Communications with the Public) defines three categories of firm written communications —correspondence, retail communications, or institutional communications—and sets principles-based content standards that are designed to apply to ongoing developments in communications technology and practices. New firms are required to file all widely disseminated retail communications with FINRA’s Advertising Regulation Department during their first year of membership, and all firms are subject to filing requirements for specified retail communications depending on their content.
FINRA Rule 2220 (Options Communications) governs firms’ communications with the public concerning options. Additionally, MSRB Rule G-21 (Advertising by Brokers, Dealers or Municipal Securities Dealers) contains similar content standards relating to municipal securities or concerning the facilities, services or skills of any municipal dealer.
Findings and Effective Practices
Findings
- Inadequate Supervision of Firms’ Social Media Influencers: Not establishing, maintaining and enforcing a system, including WSPs, reasonably designed to supervise communications disseminated on the firm’s behalf by influencers (e.g., not reviewing influencers’ videos prior to posting on social media platforms; not retaining those videos).
- False, Misleading and Inaccurate Information in Mobile Apps:
- Misstating or failing to disclose the risk of loss associated with certain options transactions.
- Distributing false or misleading promotions through social media and “push” notifications or “nudges” on mobile apps that made promissory claims or omitted material information.
- Failing to fully explain and clearly and prominently disclose risks, where required by a specific rule or needed to balance promotional claims, associated with options trading, the use of margin and crypto assets.
Emerging Trend: Retail Communications Focused on Registered Index-Linked Annuities
- FINRA’s recent g retail communications findings related to registered index-linked annuities (RILAs), include:
- inadequately explaining how RILAs function;
- insufficiently explaining specialized terms specific to RILAs (e.g., cap rates, buffers);
- not including risk disclosures (or not including them prominently);
- not including disclosures regarding fees and changes;
- making exaggerated, misleading, unwarranted or promissory statements and claims (e.g., exaggerated use of the term “downside protection” in describing buffers); and
- making hypothetical illustrations that go beyond the sole purpose of showing how RILAs function (e.g., including forward looking rates of return that project the potential future value of investing in a RILA).
- For additional guidance concerning RILAs—including findings, an overview of how these products function and definitions of specialized terms—please see the Annuities Securities Products topic.
Effective Practices
- Procedures for Mobile Apps: Maintaining and implementing procedures for the supervision of mobile apps, for example, that confirm:
- Information and data displayed to customers are accurate; and
- information about mobile apps’ tools and features complies with FINRA’s communications and other relevant rules before it is posted to investors.
- Reasonably Designed Procedures for Digital Communications: Establishing, maintaining and enforcing procedures for supervision of digital communication channels, including:
- Monitoring of New Tools and Features: Monitoring new communication channels, apps and features available to associated persons and customers;
- Defining and Enforcing Permissible and Prohibited Activity: Clearly defining permissible and prohibited digital communication channels, tools and features, and blocking those prohibited channels, tools and features that prevent firms from complying with their supervision and recordkeeping requirements;
- Supervision: Implementing supervisory review procedures tailored to each digital channel, tool and feature;
- Video Content Protocols: Developing WSPs and controls for live-streamed public appearances, scripted presentations or video blogs;
- Training: Implementing mandatory training programs prior to providing access to firm-approved digital channels, including expectations for business and personal digital communications and guidance for using all permitted features of each channel; and
- Disciplinary Action: Temporarily suspending or permanently blocking from certain digital channels or features those registered representatives who did not comply with the policies, and requiring them to take additional digital communications training before resuming use.
- Gen AI Technology:
- When using Gen AI technology to generate or otherwise assist in creating communications to customers, reviewing to ensure that these communications comply with applicable federal securities laws and regulations and FINRA rules.
- When using Gen AI technology to create or otherwise assist in creating chatbot communications that are used with investors, ensuring the appropriate supervision of those communications, and retention of those chat sessions, in accordance with SEC and FINRA rules.
- Ensuring that retail communications that mention AI tools, AI services (e.g., portfolio construction, research) or products that rely on AI management accurately describe how these offerings incorporate AI technology and balance the discussion of benefits with appropriate discussion of risks.1
- Communications Promoting Securities Lending Programs: Ensuring that communications that promote or recommend income sharing programs to retail investors (e.g., fully paid securities lending programs) accurately and clearly disclose the terms and conditions of the program, including fees customers would receive.
Additional Resources
- FINRA
1 See the 2025 Report’s Artificial Intelligence: Continuing and Emerging Trends “callout” box for additional guidance related to fulfilling regulatory obligations when using Gen AI tools.