How Financial Advisors Can Text Clients Without Violating SEC Rules

Text messaging is fast, convenient, and part of everyday communication for both clients and advisors. However, financial professionals must be careful when texting, as doing so without proper safeguards can easily lead to SEC rule violations.

The Securities and Exchange Commission (SEC) requires that all business-related communications, including text messages, be captured and retained under Rule 17a‑4. In addition, the SEC expects firms to supervise electronic communications in line with their written compliance policies. If a message involves financial advice, account activity, trade instructions, or any other form of client interaction, it is considered a business record and must be archived.

Many advisors still use personal phones or consumer apps like iMessage, WhatsApp, or standard SMS to interact with clients. These platforms lack archiving capabilities and cannot be properly monitored by compliance teams. This results in what regulators call “off-channel communication,” which has already led to billions of dollars in enforcement penalties across the industry.

So how can advisors text clients while staying compliant?

The answer lies in using a communication platform that is specifically designed to meet SEC requirements. These platforms provide secure messaging features with built-in archiving, audit trails, and administrative controls.

A compliant texting solution should allow firms to:

Automatically archive all business-related texts
Restrict usage to approved messaging channels
Monitor conversations for supervision and review
Apply retention policies and export messages for audits
Protect sensitive information through encryption

Solutions like iPlum offer all of the above, making it easy for advisors to use text messaging without stepping outside the bounds of SEC compliance. With iPlum, firms can separate personal and business communication, assign dedicated lines, and monitor staff activity through a centralized admin dashboard.

Compliance does not mean sacrificing convenience. With the right tools in place, financial advisors can continue to serve clients effectively while maintaining full regulatory alignment.

Financial advisors can use text messaging to stay connected with clients, but only if they do it the right way. Personal devices and standard messaging apps simply don’t meet SEC compliance standards. By using a secure, archivable platform designed for regulated industries, firms can maintain trust, efficiency, and full compliance.

All without compromising on convenience.