The SEC Marketing Rule did not just tweak a few advertising restrictions — it rewrote two decades of constraints on how registered investment advisers communicate their value. For the first time, RIAs can legally use testimonials, endorsements, and performance advertising. The catch is that every one of those tools comes with disclosure requirements, substantiation standards, and record-keeping obligations that did not exist before.
The SEC Marketing Rule (formally Rule 206(4)-1 under the Investment Advisers Act of 1940) took effect on November 4, 2022. It replaced two decades-old rules — the 1961 Advertising Rule and the 1979 Cash Solicitation Rule — with a single, modernized framework. For the first time, registered investment advisers (RIAs) can legally use client testimonials, endorsements, and performance advertising in their marketing. The catch: every one of those tools comes with specific disclosure requirements, substantiation standards, and record-keeping obligations. The rule does not make compliance optional or relaxed — it makes compliance more nuanced.
Advisors who understand the new framework gain a significant competitive edge. Those who ignore the details expose their firm to SEC examination deficiencies or enforcement action. This guide explains what the rule requires, what it now permits, and how to build a marketing program that stays on the right side of the line. Always confirm your specific implementation with your Chief Compliance Officer (CCO) or outside compliance counsel before publishing.
Key Takeaways (First Things First)
Before diving into the details, here is what every advisor needs to know upfront.
- The SEC Marketing Rule became effective November 4, 2022 — the compliance date advisors had to meet.
- It consolidates the old Advertising Rule and Cash Solicitation Rule into one unified framework.
- Client testimonials and endorsements are now permitted — with mandatory disclosures.
- Third-party ratings (e.g., "Top 100 Advisors" rankings) can be used in advertising if specific conditions are met.
- Performance advertising — including hypothetical and model performance — is allowed but tightly regulated.
- Advisors must substantiate all material claims and maintain records for at least five years.
- The rule applies to all forms of advertising, including websites, social media, emails, and video content.
Understanding these points sets the context for everything else in this guide.
What Is the SEC Marketing Rule, and Why Did It Change?
The original Advertising Rule dated back to 1961 — a time when digital media did not exist and "advertising" meant print or direct mail. The Cash Solicitation Rule followed in 1979. Neither framework was written for a world of LinkedIn posts, YouTube channels, Google reviews, or podcast sponsorships.
The SEC spent years studying the disconnect. In December 2020, after extensive public comment periods, the Commission adopted the new Marketing Rule. It gave firms an 18-month transition period, with November 4, 2022 as the hard compliance deadline.
The core philosophy behind the change is straightforward: the SEC recognized that blanket prohibitions on testimonials and endorsements were not actually protecting investors — they were just preventing advisors from communicating proof of their value in the same ways every other professional service does. A law firm can show client reviews. A doctor can share patient stories. A CPA can display awards. But a financial advisor, previously, could not. The new rule fixes that asymmetry, while building in guardrails to prevent deception.
Working closely with financial advisors over the past several years, I have seen firsthand how many RIA firms left legitimate marketing tools off the table entirely — not because they did not have compelling client stories, but because they were uncertain about the rules. That uncertainty cost them new business. The Marketing Rule removes that uncertainty, provided advisors take time to understand the disclosure requirements properly.
How the New Rule Compares to the Old Rules
The table below summarizes what changed between the old framework and the new Marketing Rule.
| Area | Old Rule (Pre-Nov 2022) | New Marketing Rule (Post-Nov 2022) |
|---|---|---|
| Testimonials | Prohibited entirely | Permitted with required disclosures |
| Endorsements (non-clients) | Prohibited (cash solicitation rule applied) | Permitted with disclosures and, in most cases, a written agreement |
| Third-party ratings | Not addressed; risky to use | Permitted if specific conditions are met (survey methodology disclosed, etc.) |
| Hypothetical performance | Generally prohibited | Permitted with enhanced disclosure requirements |
| Extracted performance | Only permitted in limited circumstances | Permitted with required disclosures |
| Net-of-fees presentation | Required in most cases | Still required; gross performance requires net alongside it |
| Solicitor agreements | Required written disclosure document | Still required; broader scope under "solicitation" definition |
| Record-keeping period | Varies | Five years minimum for all advertising materials |
| Scope | Print, broadcast, direct mail | All media including websites, social, email, and video |
The most commercially significant shift is the permission to use testimonials and endorsements. This single change opens up an entire category of trust-building content that advisors were previously locked out of.
What Are the Seven General Prohibitions?
The Marketing Rule does not simply list what you can do — it starts by establishing what you absolutely cannot do. Rule 206(4)-1 contains seven general prohibitions that apply to all advertisements, regardless of the specific content type.
1. No Untrue Statements of Material Fact
An advertisement cannot include any statement that is untrue or that omits a material fact necessary to make the statement, in the context it is made, not misleading. This is the foundational prohibition. It applies to every word, number, and image in your marketing materials.
2. No Materially Misleading Implications
An advertisement cannot make an implication or inference that creates a false or misleading impression, even if every individual statement is technically accurate. Context matters. If your visuals suggest a level of performance or clientele that does not reflect reality, that is a problem even if no single sentence is false.
3. No Unsubstantiated Claims
If an advertisement includes a material claim, the adviser must have a reasonable basis for believing it is true at the time of publication. This is the "substantiation" requirement. If you claim your process has helped clients retire five years earlier on average, you need documentation to support that claim before you publish it.
4. No Cherry-Picked Information
Advisors cannot present information in a way that cherry-picks favorable data while omitting unfavorable data of equal or greater significance. This is particularly relevant for performance advertising. You cannot show only your best-performing accounts or periods without proper context.
5. No Manipulation of Third-Party Content
If you reference or quote a third party — a media outlet, a publication, a rating service — you cannot edit, excerpt, or frame the content in a way that creates a false impression of what the source actually said.
6. No Untrue or Misleading Statements About the SEC
Advisors cannot state or imply that the SEC has approved, reviewed, or endorsed their marketing materials. Registration with the SEC is not an endorsement of the adviser or its investment strategies.
7. No Compliance Violations
The advertisement must comply with all other applicable provisions of Rule 206(4)-1, including the specific requirements that govern testimonials, endorsements, performance advertising, and third-party ratings.
Any advertisement that violates one or more of these prohibitions is considered "fraudulent, deceptive, or manipulative" under the Investment Advisers Act. The penalties for violations include SEC enforcement actions, fines, and reputational damage that is difficult to recover from.
What Does the Marketing Rule Actually Allow? Testimonials and Endorsements Explained
This is where most advisors' attention should focus — because this is where the biggest commercial opportunity lives. For a deeper look at how to use testimonials in your marketing strategy, see our guide on financial advisor testimonials.
What Counts as a Testimonial?
A testimonial is a statement from a current client that refers to their experience with the adviser. Under the old rule, this was prohibited entirely. Under the new Marketing Rule, you can publish client testimonials in your ads — on your website, in social media posts, in videos — provided you meet the disclosure requirements.
What Counts as an Endorsement?
An endorsement is a statement by a non-client (someone who is not currently receiving advisory services) that refers to the adviser. This includes influencer mentions, referral partner statements, and professional recommendations. Endorsements were previously regulated under the Cash Solicitation Rule. The new Marketing Rule consolidates and updates those requirements.
Required Disclosures for Both
Every testimonial or endorsement in an advertisement must include three disclosures:
- A clear and prominent statement that it is a testimonial or endorsement (i.e., the reader must know it is a paid or incentivized statement, if it is).
- Whether the person was compensated — if cash or non-cash compensation was provided, this must be disclosed.
- A brief statement of any material conflict of interest on the part of the person giving the testimonial or endorsement.
"Clear and prominent" is not a suggestion. The disclosure cannot be buried in fine print or hidden behind a link. It must be visible enough that a reasonable investor would notice it.
Compensation and Written Agreements
If an adviser compensates a third party (an endorser, a referral partner, an influencer) for promoting its services, a written agreement is generally required. The rule provides a de minimis exception: if total compensation paid to an endorser is $1,000 or less in the preceding 12 months (calculated at the time of endorsement), a written agreement may not be required.
Disqualified persons — individuals with certain regulatory or criminal histories — cannot serve as endorsers. Advisers must conduct reasonable due diligence on any compensated endorser to ensure they are not disqualified.
Working through this with advisory firm clients, I have found that the written agreement requirement is often the piece firms forget about. They get excited about using a referral partner's endorsement in a video and launch the content without the paperwork in place. That is an exam finding waiting to happen.
How Does the Rule Handle Performance Advertising?
Performance advertising is the most technically complex area of the new Marketing Rule. The SEC created detailed requirements because performance data is particularly vulnerable to manipulation — both intentional and unintentional.
What Are the Basic Performance Requirements?
Any advertisement that presents investment performance must:
- Present net performance alongside gross performance (you cannot show gross returns without showing what the client actually earned after fees).
- Show performance for specific time periods — the rule specifies requirements for 1-year, 5-year, and 10-year periods (or since inception if shorter).
- Include appropriate disclosures about the conditions under which the performance was achieved.
What About Hypothetical Performance?
Hypothetical performance — back-tested results, model portfolios, projected returns — is now permitted, but with a higher disclosure burden. The adviser must:
- Have policies and procedures in place to ensure the hypothetical performance is relevant to the financial situation and investment objectives of the intended audience.
- Provide sufficient information to allow the audience to understand the risks and limitations of the hypothetical performance.
- Disclose any material differences between the assumptions underlying the hypothetical performance and actual market conditions.
For most retail-facing advertisements, the SEC has made clear that the bar for meeting these requirements is high. Hypothetical performance in advertising directed at retail investors is generally only appropriate when the adviser can make a strong case that it is relevant to that specific audience.
Can Advisors Show Extracted Performance?
Extracted performance refers to showing the results of a subset of accounts — for example, only showing the performance of your growth-equity strategy rather than your entire book of business. The old rule generally prohibited this. The new rule permits it, provided the advertisement shows the performance of the same strategy across all accounts managed according to that strategy (with limited exceptions), or includes adequate disclosure about what is and is not included.
Is Your Marketing Built for Compliance AND Growth?
Most financial advisors are stuck at one extreme: so focused on compliance that their marketing barely exists, or marketing aggressively with no compliance framework behind them. Neither is sustainable. OJay Media works exclusively with advisors, RIAs, and wealth management firms to build programs that generate real leads — within the guardrails of the SEC Marketing Rule.
Book a Free Strategy CallSee what a compliant, performance-driven content strategy looks like for your practice.
What Are the Record-Keeping Requirements?
The SEC expanded record-keeping obligations significantly under the new Marketing Rule. Advisers must retain:
- All advertisements (in the form circulated or used) for a minimum of five years.
- Any documentation that formed the basis for any performance shown in the advertisement.
- A list of the accounts included in any composite or extracted performance presentation.
- Written agreements with endorsers and solicitors.
- Substantiation documentation for any material claims.
Record-keeping is not just about being able to produce materials during an SEC examination. It is also about forcing internal discipline. When you know you have to document the basis for every claim before you publish, you tend to be more careful about what you say. That is a feature, not a bug.
How Does This Affect Social Media Marketing?
The Marketing Rule applies to all advertising channels — including social media. This matters because social media creates specific compliance challenges that do not arise in traditional advertising formats.
What Counts as an Advertisement on Social Media?
Any post, video, story, or comment that meets the rule's definition of an "advertisement" is subject to the Marketing Rule. The definition is broad: communications made by an investment adviser that offer investment advisory services to prospective clients or that promote investment advisory services to prospective or existing clients.
Organic posts on LinkedIn, Facebook, or Instagram that promote your services are advertisements. Paid social media ads are advertisements. Responses to reviews on Google are potentially advertisements if they can be construed as promoting your services.
Social Media-Specific Issues
Resharing and Endorsements: If a current client reposts or shares your content with a positive comment, that can function as a testimonial. You may not be able to control what clients say publicly — but if you encourage or facilitate the sharing, you take on responsibility for the disclosure requirements.
Third-Party Ratings: If you want to display a "Top 100 Advisors" badge or cite a publication's ranking in a social media post, the Marketing Rule requires that you disclose who created the ranking, the criteria used, and whether you paid to participate in any associated program. See our post on FINRA marketing compliance for additional rules that layer on top of the SEC's framework.
Employee Social Media: Posts by firm employees on their personal social media accounts can sometimes be attributed to the firm. Your compliance policies need to address what employees can and cannot say about the firm's services on personal channels.
For a broader look at digital marketing for RIAs, see our guide to RIA marketing.
What Does Compliance-First Marketing Actually Look Like?
A compliant marketing strategy is not a stripped-down, boring marketing strategy. Compliance and effectiveness are not opposites — they just require intentional planning. Here is how well-run advisory firms are approaching marketing under the new rule.
Building a Compliant Testimonial Program
The steps are straightforward:
- Identify willing clients who have had positive outcomes and who understand what they are agreeing to.
- Draft a written disclosure that the client reviews and acknowledges, confirming that the testimonial reflects their genuine experience.
- Produce the testimonial content — written, video, or audio — in its final form.
- Apply required disclosures to the published version (compensation status, conflicts of interest).
- Archive the documentation in your compliance records.
This does not have to be complicated. For many advisory firms, a simple one-page disclosure acknowledgment and a short video interview is all it takes to turn a satisfied client into a powerful trust signal on your website.
For a complete breakdown of how to build a testimonial strategy, see our article on financial advisor testimonials.
Building Thought Leadership That Complies
Content marketing — blog posts, podcasts, YouTube videos, LinkedIn articles — is the lower-risk category of marketing under the new rule. Educational content that does not make specific performance claims or solicit specific investment recommendations is generally not classified as an "advertisement" under the rule's definitions.
This means that a well-built content program is both effective and relatively straightforward from a compliance standpoint. Writing about financial planning concepts, tax strategies, retirement income decisions, and wealth management principles does not trigger the full weight of the Marketing Rule — and it builds the kind of topical authority that earns organic search rankings over time. See our guide on content marketing for financial advisors for a framework on how to build this out.
Fiduciary Advisors: An Additional Layer
For advisors operating under a fiduciary standard — fee-only RIAs in particular — the Marketing Rule intersects with your fiduciary obligations. Your marketing must not create a misleading impression about your compensation structure, your conflict-of-interest management, or the nature of the services you provide. Fiduciary marketing done right is actually a significant competitive differentiator. See our guide on fiduciary advisor marketing for a detailed look at how to use fiduciary positioning as a lead-generation asset.
How Should Advisors Prepare for an SEC Exam Under the New Rule?
Marketing has historically been a secondary focus in SEC examinations. That is changing. The Marketing Rule compliance has been an examination priority for the SEC's Division of Examinations since the November 2022 compliance date.
Examiners are looking at:
- Whether the firm's written policies and procedures address the new Marketing Rule requirements in detail.
- Whether advertisements in use (including website content, social media, and third-party platforms) comply with the seven general prohibitions.
- Whether performance presentations meet the net-of-fees, time-period, and disclosure requirements.
- Whether testimonials and endorsements are properly disclosed and documented.
- Whether record-keeping practices are adequate to produce required materials on request.
The best exam preparation is not a last-minute review of your website — it is an ongoing compliance culture where every piece of marketing content goes through a documented review process before it goes live. Your CCO should be involved in reviewing advertising materials, and your compliance calendar should include periodic audits of published content.
What Should Advisors Do Right Now?
If your firm has not done a Marketing Rule compliance audit since November 2022, it is overdue. Here is a practical checklist to work through with your CCO:
- Audit all current advertising — website, social media, email campaigns, pitch decks — against the seven general prohibitions.
- Review performance presentations for compliance with net-of-fees, time-period, and disclosure requirements.
- Identify all testimonials or endorsements currently in use and confirm they have the required disclosures.
- Check all third-party rating references (badges, rankings, "Top Advisor" designations) for compliance with the rating-related conditions.
- Update written policies and procedures to specifically address the new Marketing Rule.
- Train staff on what constitutes an advertisement and what the disclosure requirements are.
- Implement a pre-publication review workflow so no marketing material goes live without compliance sign-off.
- Audit your record-keeping system to confirm you are capturing and retaining all required materials for the required period.
This process is not a one-time exercise. Marketing materials change constantly. The audit should be a recurring function, not a project with a completion date.
- The SEC Marketing Rule (Rule 206(4)-1) took effect November 4, 2022, replacing the 1961 Advertising Rule and 1979 Cash Solicitation Rule.
- Testimonials, endorsements, third-party ratings, and performance advertising are now permitted — each with specific disclosure and substantiation requirements.
- Seven general prohibitions apply to every advertisement, regardless of content type or channel — including websites, social media, email, and video.
- Advisers must substantiate all material claims and retain advertising records for at least five years.
- The biggest commercial opportunity is the testimonial and endorsement permission — but only when the disclosure framework is built correctly.
- Build a documented pre-publication review workflow with CCO sign-off; treat compliance auditing as a recurring function, not a one-time project.
If you want a compliant, lead-generating marketing program built end-to-end for your firm — testimonials sourced and disclosed correctly, content engine running, paid media inside the guardrails, and qualified appointments on your calendar — that is exactly what we do at OJay Media Marketing. We work with a limited number of advisor clients and only with firms positioned for serious growth.