On the heels of its risk alert addressing the testimonials, endorsements, and third-party rankings provisions of the Marketing Rule, the SEC published two FAQs regarding the Marketing Rule.
The risk alert, which was published on December 16, 2025, detailed observations and deficiencies regarding investment advisers’ advertisements of client testimonials, endorsements, and rankings and ratings provided by third-parties. Deficiencies noted in the risk alert primarily centered around a lack of, or inadequate disclosures, though the SEC also observed other Marketing Rule violations, including lack of written agreements with paid promoters, allowing endorsements by ineligible persons, and due diligence failures regarding third-party rankings and surveys.
The two new FAQs were published on January 15, 2026. One FAQ specifically addresses a topic covered by the risk alert – namely, testimonials and endorsements made by ineligible persons. This FAQ addresses the SEC’s position regarding compensation paid to a person disqualified by a self-regulatory organization when the SRO has not barred or suspended the person or prohibited the person from acting in a capacity in connection with the disqualifying conduct. The second FAQ addresses the use of model fees in performance advertising when the actual fees used to calculate the net performance advertised may be lower than fees anticipated to be charged to the intended audience of the advertisement.
The two FAQs may be found here.
If you have any questions or need additional guidance regarding the Marketing Rule, the SEC’s Risk Alert, or FAQs, please contact us.