AN INVESTIGATIVE EYE ON: SOCIAL MEDIA FOR (U)HNW INDIVIDUALS AND FAMILIES
In the current climate of authenticity and “people buy people” the benefits of incorporating social media usage into a (U)HNWI or family office reputation and profile-raising strategy are manifold: building brand reputation and pitching your ethos and culture; creating a powerful personal platform for yourself (for example, more people follow Tim Cook on Twitter than follow Apple: 12.9 million followers vs. 6.2 million); and attracting new investment opportunities.
However
This increased public awareness of who you are, can lead you (and your family and investments) to be exposed in unforeseen areas. Careful management is therefore required before, and as, (U)HNWI and family offices launch themselves (note: not their corporations – that’s a conversation for another time!) into the public domain, and into the path of public scrutiny.
Broadly speaking, the public domain is the starting point for any investigation – due diligence, asset recovery, counter-party intelligence: if it can be found on the web, we will find it. In my work as a professional investigator, social media has become a key source of information across all project types.
I don’t say this to cause undue paranoia – and send you running to shut down your Instagram and Twitter accounts - but to raise awareness of the possibility of unintended disclosure of information that arises when one begins to engage openly and publicly on social media.
Below, I highlight some of the areas where social media usage can leave an (U)HNW client unintentionally exposed by looking at social media through the eyes of an investigator. As above, the public domain feeds into many a varied investigation, and thus not all vulnerabilities outlined are applicable to everyone. On an individual basis, the identification of potential risk on social media is determined by viewing that profile against the client’s own concerns, ambitions, and context.
***
Consideration one: Family (Office) Values and Public Perception
Great messaging, an impressive and considered investment portfolio, philanthropic ventures: a considered family office brand to present to the world. Problem? Individuals separately choosing to subject themselves – and therefore their relatives - to an enhanced level of scrutiny by exposing their lifestyles, thoughts, and observations on a massively public platform.
Does this matter?
Yes. Aside from friction stemming from differing personal views on privacy, any off-key comments or a visible lack of unity could potentially undermine family standing. This is particularly the case with GCC nations where private wealth, business and sovereign families (and their offices) have roles significantly beyond that of economics - in upholding and embodying the values of local society and culture.
What then becomes important is ensuring an alignment in how social media is utilised, what is said, and with whom individuals are engaging. This is a useful exercise on a day-to-day basis, but pays off at moments when family alignment or an individual’s good public standing is pivotal – for example, ahead of an attention-drawing IPO or major investment.
Why? Once it enters the public domain, very little information ever disappears. In fact, there is a particular enjoyment from certain quarters of the media in turfing up old tweets that absolutely undermine an individual’s current, and carefully curated, image. Think of, for example, the recent unearthing of aggressive and personally insulting tweets written by Chrissy Teigen, some years ago, directed at certain women in the public eye encouraging suicide and mocking self-harm. Although she has apologised, this has no doubt shaken the feminist, approachable, family-orientated, and entrepreneurial image she has cultivated in recent years.
In an enhanced due diligence investigation these factors come into play, particularly when looking for any potential reputational red flags. Similarly, such a review is equally important for reverse due diligence: yes, what you are saying and posting today is important, but management of that can fall short when you don’t remember who you used to be, but the internet does.
Consideration Two: Disclosure of Personal Wealth and Lifestyle
In 1973 John Paul Getty III, grandson of oil magnate J. Paul Getty, was kidnapped in Rome. A ransom demand of USD 17 million was sent to his grandfather – 1957’s “richest living American” (Fortune Magazine) and 1966’s “world’s richest private citizen” (Guinness Book of Records). Could he pay it? Yes, easily. Did he? No.
“If I pay one penny now, I'll have 14 kidnapped grandchildren”[1]
Although harsh in the extreme, J. Paul Getty’s response raises an important point: the exposure and possibility of making yourself a target that comes from (displays of) massive wealth. And this was in 1973. Social media has merely upped the ante.
An (U)HWNI can choose to be low-key about their assets and investments, or the scale of their wealth: keeping a low profile on public platforms, using extensive corporate structures that can minimise tax exposure and ease transfers of assets to the next generation, and generally limit the on-paper relationship between themselves and their assets.
This careful work can come unstuck however if it is only the primary wealth holder who keeps a low-profile. Pictures of yachts, vineyards, fast cars, stunning jewellery, and expansive real estate all over Instagram courtesy of other family members can so quickly undermine all the careful planning, and can be an (almost literal) gold mine in an asset tracing investigation.
Returning to J. Paul Getty’s heart-warming earlier quote, serious security issues can also arise through public displays of wealth and location. The 2013 film The Bling Ring[2] was a Hollywood spin on the real story of a spate of burglaries by LA teenagers at the homes of the rich and famous, capitalising on social media to tell them when properties were empty and what those houses contained. The burglary at Tamara Ecclestone’s house, and the theft of Kim Kardashian’s engagement ring and jewellery from her person in Paris are more recent and shocking examples of the possible negative repercussions of releasing information about your assets, your location, and your home to the internet.
***
So should you be pressing delete on your social media accounts?
I would argue - no. First, engaging with social media can be a huge advantage in building your profile and raising awareness of your businesses and endeavours. Second, other family members are probably already using social media – providing public glimpses into your lifestyle whether you want them or not. So instead the point becomes: how can you harness this and make it work for you (and your family)?
To keep this short, what is needed is planning, forethought, and the right advisors. The latter – if they have a good understanding of who you are, what you want to achieve, and where your concerns lie – are in the best position to stress-test your profile, and respond to potential issues. Families and family offices need to be addressed as a whole, to ensure all members across generations are equally represented, avoiding kickback from disenfranchisement or perceived censorship. Ideally, consensus is secured over what is shared – but we don’t live in a perfect world, so working with your advisors on risk planning and mitigation (what do you not want posted, what are the implications, what do we do if it happens) is an effective insurance policy. Last of all – and a note to us all - think before you post!
[1] https://www.nytimes.com/2011/02/08/world/europe/08gettyobit.html
[2] https://www.her.ie/entertainment/hollywood-hills-burglars-the-real-story-behind-the-bling-ring-32146