The SEC Marketing Rule, Explained for Advisors

Most advisors know the SEC loosened the rules on testimonials a few years ago. Fewer know exactly what changed, and that gap is expensive. Since 2023 the SEC has fined 24 advisers a combined $2.4 million for marketing mistakes, many of them small firms with a single website page that broke the rule.

This guide explains the rule in plain language. Use it to plan your marketing, then hand the checklist at the end to your chief compliance officer (CCO). It reflects SEC guidance through October 2026, including the staff FAQs published in March 2025 and January 2026.

What the SEC Marketing Rule covers

The Marketing Rule is SEC Rule 206(4)-1 under the Investment Advisers Act. The SEC adopted it in December 2020, it took effect on May 4, 2021, and firms had to comply by November 4, 2022. It replaced two older rules: the advertising rule, which banned testimonials, and the cash solicitation rule, which governed paid referrals.

The new rule takes a principles-based approach. It lists seven things an ad can never do, then adds specific conditions for testimonials, endorsements, third-party ratings, and performance. That structure gives you more room to market than before, as long as you can back up what you say.

Is it an advertisement?

The rule only applies to advertisements, so this is the first question to answer for any piece of content. The SEC’s definition has two parts. The first covers any communication that offers your advisory services to more than one person. The second covers any testimonial or endorsement you paid for, no matter how many people see it.

In practice, nearly everything on your website counts. So do your LinkedIn posts, email newsletters, seminar slides, and YouTube videos. Your Form ADV and other required filings are excluded, and so are one-on-one conversations with a prospect.

The seven general prohibitions

These apply to every advertisement, including pages with no testimonials or performance at all. Six of them come with an example below. The seventh is a catch-all: nothing else in the ad can be materially misleading.

Testimonials, endorsements, and third-party ratings

This is the part of the rule that changed the most. Under the old advertising rule, an SEC-registered advisor couldn’t quote a client at all. Now you can, as long as the reader can tell who is speaking and why.

The three disclosures every testimonial needs

Each one has to appear clearly and prominently at the same time as the testimonial. In practice that means right next to it, in the same size type.

• Whether the person is a current client
• Whether they were paid, and the material terms if so
• Any material conflict of interest, like a family tie or business relationship

A short line works: “Jane D. is a current client. She received no compensation for this statement.”

Paid referral partners count as endorsers. If you pay a CPA or a lead service for introductions, the same disclosures apply, and payments over $1,000 in a 12-month period also require a written agreement and a check that the person isn’t barred by a past regulatory or criminal action.

Online reviews and social media

Reviews are now one of the most cost-effective ways to grow. In Kitces Research’s 2026 study of 506 advisors, firms that displayed reviews on their own website spent about 13 cents for every dollar of new revenue that came in. That is the lowest cost of any tactic in the study.

The catch is that reviews only count in your favor if you collect them the right way. Kitces found that only 16% of clients at the median firm leave a review when asked, so a steady, fair process matters more than a big one-time push.

When a review becomes your ad

A review on Google or a review site is the client’s statement. It becomes yours, and falls under the rule, when you adopt it (share it, quote it, or feature it) or get entangled in it (write it, edit it, or pick which ones appear).

Letting people “like” or comment on your posts doesn’t make their comments yours. Deleting the negative ones does. Once you hide the bad reviews, the SEC treats the good ones that remain as your advertisement.

Social media follows the same logic. A post that promotes your services is an ad. A post you share from a client, or a review you repost, carries the same disclosure duties as a testimonial on your website.

Performance advertising

If you show investment results, the rule gets specific. Most independent advisors are better off leaving performance off their public website entirely, but if you do show it, these are the conditions.

• Net next to gross. Any gross return needs a net-of-fee return beside it, at least as prominent, using the same period and method.
• 1, 5, and 10 years. Portfolio and composite results need all three periods (or the life of the portfolio if shorter), ending at the most recent calendar year-end.
• No SEC approval claims. You can’t say or imply the SEC reviewed your numbers.
• Hypothetical performance needs a target audience. Model, back-tested, or projected results require policies showing they fit the reader’s situation. That is almost impossible on a public web page.

What changed in 2025 and 2026

The SEC staff has updated its Marketing Rule FAQ twice in the last two years:

• March 19, 2025, extracted performance. You can show gross-only results for one holding or sleeve of a portfolio if you also show the whole portfolio’s gross and net results, with equal prominence, over the same period.
• January 15, 2026, model fees. The staff clarified that net performance doesn’t always require a model fee. It depends on the facts and how clearly you disclose the fee difference.
• January 15, 2026, SRO orders. Certain final orders from self-regulatory organizations no longer automatically disqualify a promoter, as long as the order is disclosed and linked in your ads for 10 years.

What the SEC has fined advisers for

The SEC has brought four rounds of Marketing Rule cases since 2023. Two of them targeted the same mistake: hypothetical performance posted on a public website without the required policies.

The SEC’s Division of Examinations also published a risk alert on December 16, 2025 listing the problems examiners keep finding. If you only fix eight things, fix these.

Recordkeeping

Two of the nine firms fined in 2023 also failed to keep copies of their ads, and Meridian’s 2025 case cited missing records from both the firm and its website vendor. Under Rule 204-2 you need to keep:

• A copy of every advertisement you publish, including each version of your website
• Records showing how you calculated any performance you advertised
• Your testimonial and endorsement disclosures, and the basis for believing they comply
• Any questionnaire or survey behind a third-party rating you use

Make archiving automatic

Website changes are the records most firms lose. Ask your web team to save a dated PDF or archive snapshot every time a page goes live. Many archiving services capture websites and social accounts automatically. Your agency should hand you final approved files in a form you can store, and Advantagy delivers them that way by default.

Broker-dealer reps, insurance, and state-registered advisers

If you’re dually registered or sell insurance, the SEC rule is only part of the picture.

FINRA Rule 2210

FINRA calls a written message to more than 25 retail investors within 30 days a “retail communication.” A registered principal at your broker-dealer has to approve it before it goes out, and your website needs a link to BrokerCheck. If you pay someone more than $100 for a testimonial, you have to disclose that.

Two recent changes matter. On October 15, 2026, the SEC approved a FINRA amendment that will allow projections and targeted returns under strict conditions. It isn’t in effect yet, and FINRA aimed it at institutional and sophisticated investors. FINRA also proposed a broader update in Regulatory Notice 26-14 (July 2026) that would move from principal pre-approval to a risk-based review. That remains a proposal for now.

FINRA has also said its rules apply to AI-written content exactly as they apply to anything a person writes (Regulatory Notice 24-09).

Insurance and annuities

Most states base their rules on the NAIC’s Advertisements of Life Insurance and Annuities Model Regulation (#570). Ads must be truthful and judged by their overall impression on an average reader. Words like “savings” or “investment” are restricted when they could mislead someone about an insurance product. The insurer keeps each ad for five years after its last use.

State-registered advisers

Your state securities regulator sets your advertising rules, and many states historically banned testimonials. NASAA members voted on May 4, 2026 to update the model rules so states can allow testimonials, endorsements, ratings, and performance with guardrails similar to the SEC’s. Check with your state regulator before you assume the change applies to you.

A pre-publish checklist for your CCO

Run every new page, post, and email through these ten checks before it goes out. It takes about five minutes and covers the issues behind every SEC case listed above.

How Advantagy writes marketing that clears compliance

Every page, post, and email we write for advisors starts with these rules. Our financial content team is led by Sean Harvey, who spent 13 years as senior writer and head of PR at Allworth Financial. Drafts reach your compliance team already checked against the Marketing Rule, FINRA 2210, and state insurance rules, so they come back approved instead of marked up.

This guide is general information about SEC, FINRA, and state rules as of October 29, 2026. It isn’t legal or compliance advice. Advantagy is a marketing agency, not a law firm or compliance consultant. Your CCO or broker-dealer always has the final say.

Frequently asked questions