We tried to warn you.
Last year, when Facebook announced that it was allowing banks to target people based on their demographics when promoting credit products, real estate, or employment-related posts, we predicted that this practice would violate the Equal Credit Opportunity Act. Now, as part of a legal settlement, Facebook is changing its advertising methods and will no longer allow housing, employment or credit ads that target people by age, gender or zip code.
In a recent lawsuit against Facebook, a complaint was made that Facebook violated the Fair Housing Laws by allowing advertisers to exclude certain groups of people. That’s a real problem because, even though Facebook allowed banks and credit unions to target specific audiences, the rules governing social media compliance for banks still applied, and the Federal Financial Examinations Institute Council (FFIEC) social media guidelines still needed to be followed.
Now that this practice has been banned, it’s the perfect time to take a step back and see how well your bank or credit union is complying with the FFIEC guidelines. There are three main questions you need to ask yourself when it comes to social media compliance for credit unions and banks. They are:
1. Are you using Facebook ads?
While there’s no prohibition against creating to target specific consumers based on demographic information mined by Facebook, you cannot use this information to violate fair lending laws or unfairly discriminate against people.
2. Do your ads promote credit cards, loans, or real estate-related products?
If so, you must be especially careful as it is a violation of the Equal Credit Opportunity Act to market these products in a way that would exclude certain demographics.
3. What happens if you use Facebook ads incorrectly?
If your Facebook ads violate fair lending laws, you can face lawsuits, class actions, punitive damages of $10,000 per person discriminated against, or fines starting at $500,000 – holy moly!
So, how can you protect your business and make sure you’re following the social media guidelines for banks and credit unions? The first step is to contact the Social Media Law Firm.
At the Social Media Law Firm, we can conduct a social media risk assessment to determine your current level of compliance with regulations that govern the banking industry on social media, including the Equal Credit Opportunity Act and the FFIEC social media guidelines. With our assessment in hand, you’ll have the tools you need to execute your social media strategies while eliminating social media legal risks.
What are you waiting for? Call us today for your free consultation!
