The SEC continues to focus heavily on marketing during examinations, with renewed attention on testimonials, endorsements, and third party ratings
Recent exam findings show that clear disclosures, consistent presentation, and documented oversight remain challenges for many investment advisers. Firms relying on dated procedures and legacy practices are seeing increased scrutiny across websites, social media, and awards. Risk alerts like this are often the SEC’s way of setting the table before bringing the hammer down in exams.
Below summarizes the SEC’s key examination trends and practical steps advisers should be addressing now to reduce marketing related exam risk.
Introduction
On December 16, 2025, the SEC Division of Examinations issued a Risk Alert titled Additional Observations Regarding Advisers’ Compliance with the Advisers Act Marketing Rule (link) . The Alert reflects continued examination focus on Rule 206(4)-1 and highlights recurring compliance failures across registered investment advisers.
This memorandum summarizes Key Bridge Compliance’s observations and frames the SEC’s findings for wealth advisers based on issues examiners are actively citing during examinations.
Readers seeking practical steps may proceed directly to the Recommendations section.
Regulatory Background
The Marketing Rule permits testimonials, endorsements, and third party ratings, subject to detailed requirements related to disclosure, oversight, and documentation.
Examiners no longer view Marketing Rule compliance as transitional. Firms are expected to maintain mature processes, written controls, and documented supervision.
For wealth advisers, examination risk most often arises from websites, social media, referral arrangements, influencer activity, and award marketing.
Key Examination Findings
Testimonials and Endorsements
SEC staff continue to identify deficiencies in how advisers use testimonials and endorsements. Common issues include:
- Failure to disclose whether the promoter is a current or former client
- Failure to clearly disclose cash or non-cash compensation
- Missing or vague descriptions of material conflicts
- Reliance on hyperlinks instead of embedded disclosures
- Disclosures presented less prominently than the testimonial itself
These issues are frequently identified by KBC’s Marketing Review team and remain a core focus of examinations.
Examiners also cited firms that failed to recognize influencer activity or referral arrangements as endorsements. In several cases, firms lacked written agreements or could not demonstrate a reasonable basis for compliance.
The SEC further identified instances where advisers compensated ineligible promoters, including individuals with disqualifying disciplinary histories, where the firm knew or should have known of the ineligibility.
Third Party Ratings and Awards
Examiners continue to scrutinize the use of awards, rankings, and “best of” recognitions.
Recurring deficiencies include:
- No documented due diligence on how the rating was calculated
- Failure to retain or review the underlying questionnaire or survey
- Missing disclosures regarding the date, period evaluated, or rating provider
- Failure to disclose payments for logo usage, visibility, or award consideration
- Disclosures placed far from the rating or displayed less prominently
The SEC flagged situations where firms paid for enhanced placement or promotional rights without disclosing that compensation. This remains especially common with so called “free” awards.
Documentation and Supervision Gaps
Across testimonials, endorsements, and ratings, the SEC emphasized weak documentation and oversight.
Common gaps include:
- No written policies tailored to the Marketing Rule
- No centralized inventory of testimonials, endorsements, or ratings
- No evidence of periodic review or testing
- No centralized approval or recordkeeping process
Examiners are requesting documentation and proof, not assurances. Firms relying on informal or legacy review practices face increased risk following issuance of this Risk Alert.
Recommendations
Advisers should assume marketing will be reviewed in every SEC examination. With the SEC’s increasing use of artificial intelligence tools, firms should expect comprehensive reviews rather than limited sampling.
Advisers should also expect that exam staff have already reviewed firm websites and identified potential issues, particularly involving testimonials, endorsements, and third party ratings.
Based on current examination activity, we recommend:
- Maintain a centralized inventory of all testimonials, endorsements, and ratings, including approval dates and review history
- Use embedded, prominent point of use disclosures for testimonials, endorsements, and ratings
- Formalize written agreements with promoters where required
- Perform and document due diligence on each third party rating and update it annually
- Update policies and procedures to reflect current marketing practices
- Train advisers and marketing staff on what qualifies as a testimonial or endorsement
- Retain evidence of review, approval, and ongoing monitoring
Final Takeaway
Marketing remains a core focus in SEC examinations. Examiners expect clear disclosures, consistent presentation, and documented oversight.
Our KBC compliance team supports investment advisers so they can stay focused on their clients. KBC’s Marketing Review team reviews thousands of marketing pieces each year and provides ongoing marketing training. The scale of these reviews gives our clients meaningful insight to benchmark their marketing compliance program against peer firms, informed by direct examiner feedback from SEC examinations.
For assistance with your marketing compliance program, contact inquiries@keybridgecompliance.com.