SEC Adopts Modernized Marketing Rule for Investment Advisers

December 22, 2020 saw the Securities and Exchange Commission (SEC) release its final version of the modernized Marketing Rule.  This Marketing Rule replaces the Advertising and Solicitor rules under the Investment Advisors Act.  The approximate length is over 400 pages, but the SEC’s press release did a fantastic job of the major points.  These major points include:


·                Updating the definition of advertising

·                Describing general prohibitions

·                Allowing the use of testimonials and endorsements

·                Discussing third-party ratings

·                The use of performance in marketing

·                Updating Form ADV and books and records requirements

·                Withdrawing prior SEC Staff Guidance


The size and internal structure of your RIA will determine who will be involved in ensuring the new rule is properly implemented.  In most firms, more than one person is involved in the creation, review, approval, and distribution of advertising and marketing materials.  If your RIA has a cohesive team, there should be little problem, but disagreements over advertising and marketing can sometimes test the mettle of even the strongest team.


The SEC stated “The marketing rule, amended books and records rule, and related Form ADV amendments, will be published on the Commission’s website and in the Federal Register. All will be effective 60 days after publication in the Federal Register. The Commission has adopted a compliance date that is 18 months after the effective date to give advisers a transition period to comply with the amendments.”

Investment advisers have plenty of time to review, update, and implement accordingly.  This doesn’t mean you should wait.  There’s some excitement amongst investment advisers about using testimonials and endorsements.  Contact us to discuss how we can help you with this.

SEC Adopts Modernized Marketing Rule for Investment Advisers
Venturis Solutions, Paul Mallory 11 January, 2021
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