Yesterday, I attended a Public Relations Society of America (PRSA) seminar titled, “Regulatory Scrutiny of Social Media.” The speakers were attorney Michael Lasky of Davis & Gilbert LLP and Tricia Geoghegan, who oversees several social media initiatives for Johnson & Johnson.

Lasky provided a quick overview of the recently enacted Federal Trade Commission guidelines on testimonials and endorsements. The harsh reality is that marketers (including their agencies) can now be held liable for a blogger’s unsubstantiated or misleading claims. A blogger can be defined as anyone posting information on a social media channel. Geoghegan noted that brands considering their social media strategies should factor in both the marketing opportunity and their responsibility to community. While this is particularly true for a consumer healthcare company, I think all businesses can benefit by thinking in those terms.

Lasky offered tips to the audience to avoid a run-in with the law. Here’s my condensed version:

1. Encourage bloggers to disclose any material connections (including the acceptance of free products!).
2. Monitor blogs to ensure statements about your products/services aren’t misleading.
3. If you’re posting about your own company (or your client’s), be transparent about your connection.
4. “Street team” members and celebrity endorsers should also make their relationship to the marketer clear.
5. Develop written policies and procedures for employees who participate in social media.
6. Add the subject of disclosure to your media training process.
7. Ask yourself if your social media practices are likely to deceive the average consumer.
8. Seek legal counsel on new initiatives (can’t blame the guy for including a plug!).

As the Federal Trade Commission drafts new rules on bloggers’ disclosure of sponsored content, BlogHer, the community of thousands of influential female bloggers, is in the midst of its fifth annual convention in Chicago.

We attended BlogHer in 2006 on behalf of our client WeightWatchers.com. The debate about the precarious relationship between trusted information sources and marketers with dollars aimed at garnering positive product reviews was percolating then and it’s raging now. (Incidentally, WeightWatchers.com was paying to attend the conference and exhibit, but they weren’t paying bloggers for posts.)

Days before this year’s conference kicked off, Elissa Camahort Page, the community’s co-founder, told AdAge that disclosure alone is insufficient. Her network is advocating that bloggers create a separate section of their blogs for reviews based on freebies, perks or outright compensation.

We’re members of the Word of Mouth Marketing Association and we’ve always been proponents of transparency. Camahort Page’s new proposal’s an interesting one. Ultimately though, which of the many proposals on the table is adopted doesn’t matter as much as continuing the lively dialogue. It’s important that there’s real forward movement on the establishment of best practices and policies – something both bloggers and marketers desperately need – especially since this world is evolving so quickly (next frontier: sponsored tweets).

Publishers, like mommy bloggers, have a right to monetize their work – how else will they survive and thrive? But they also need to retain their credibility and authenticity. We’re hopeful that as the industry moves towards consensus on these issues we’ll strike a satisfactory balance.