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EC Zeroes In on Persistent Marketing Rule Failures With New Staff FAQs

Posted on January 22nd, 2026 at 3:51 PM
EC Zeroes In on Persistent Marketing Rule Failures With New Staff FAQs

The Securities and Exchange Commission (SEC) has sharpened its scrutiny of investment adviser marketing practices, signaling continued frustration with recurring compliance failures despite years of guidance and enforcement. As reported by Financial Advisor News, new staff FAQs published in January follow a December risk alert that detailed persistent deficiencies involving testimonials, endorsements, and third-party rankings.

According to Financial Advisor News, the new guidance targets two areas that continue to draw examiner attention. One FAQ addresses who may provide a compensated testimonial or endorsement. The other focuses on performance advertising when future clients may pay higher fees than those used in historical performance calculations.

Financial Advisor News reports that the December risk alert identified a familiar pattern of violations. SEC examiners observed advisors using testimonials without required disclosures, paying promoters without written agreements, allowing endorsements from ineligible individuals, and failing to conduct adequate diligence on third-party ratings and surveys. 

The December risk alert underscored the SEC’s diminishing tolerance for firms that assume they resolved marketing issues years ago. Financial Advisor News reports that examiners continue to find gaps between written policies and actual practices, particularly where marketing, digital, and compliance functions fail to align.

For advisors, the takeaway remains practical and immediate. Firms must continuously vet testimonials and endorsements, not merely at onboarding. Performance advertising must reflect the fees clients are likely to pay, not the most favorable historical assumptions. Disclosures must remain clear, current, and unavoidable.

Although staff FAQs do not carry the force of law, they provide a clear window into examiner priorities. 

ÍøÆØ³Ô¹Ï LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

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