The way that brokers communicate with the public is closely monitored in an effort to prevent scams, false advertising and misleading advice.
It’s the reason why, even as their customers flocked to services like Twitter and Facebook, the big banks banned their brokers from using these services for work.
But Morgan Stanley, the largest U.S, retail brokerage with 17,800 advisers, now plans to allow its staff limited access to both Twitter and LinkedIn, which just completed a very successful IPO, on which Morgan Stanley was a lead underwriter.
Every tweet and status update will be captured by the firm and stored as official record. Broker’s won’t be allowed to recommend one another on LinkedIn or tweet out anything beyond pre-approved company reports and broad market outlooks.
The volume of these folks already operating on StockTwits under assumed names kind of makes the announcement seems a bit inane, but no doubt some drama will quickly emerge as insider gossip from the street begins to leak onto Twitter.