Financial advisors who research potential clients online or conduct background checks via social media on candidates for a staff position need to be careful that they are not in violation of privacy law.
To help clarify what is permitted and what is not, the privacy commissioners in British Columbia and Alberta have recently released guidelines.
The documents, Guidelines for Social Media Background Checks were released in Oct. 2011 by B.C. and in Alberta in Dec. 2011. They are meant to help business owners adhere to these provinces’ Personal Information Protection Acts.
Under that legislation, employers who conduct background checks on potential employees using social media may be violating the individual’s privacy rights. The legislation describes social media as social networking sites, blogs, micro-blogging and file sharing sites.
In provinces without specific privacy legislation in this area, including Ontario, the federal Personal Information Protection and Electronic Documents Act applies. The federal privacy commissioner’s office also offers guidelines on the use of social media in this context.
While it’s acceptable for advisors to conduct searches for personal reasons, privacy law comes into play the minute the search is business related, such as finding a new team member or prospective client.
“If [advisors] are doing research for business purposes PIPA would apply,” says Caitlin Lemiski, a policy analyst with the Office of the Information and Privacy Commissioner for British Columbia in Victoria. “So, they have to be really careful about the kind of information they collect.”
Information that is safe to collect during an online background check includes: information from an online telephone directory, newspapers or court records.
It does not matter whether the information is collected from an office computer, home laptop, tablet or smart phone, says Lemiski.