Marketing Rule ‘Represents Balance’ in Mandate To Back Up Claims: SEC Official
by: Mark Schoeff Jr.
The U.S. Securities and Exchange Commission’s (SEC) new marketing rule governing how investment advisors advertise their practices requires that they back up their claims, but that doesn’t mean advisors have to keep an overly detailed list of the claims they make, Thoreau Bartmann, co-chief counsel in the SEC’s Division of Investment Management, said at a recent industry event. The measure allows investment advisors to use testimonials and endorsements for the first time and generally gives them more latitude to promote themselves. That freedom comes with myriad obligations, including that advisors must prove what they say in their ads when SEC examiners inquire. "It doesn’t require literally a bible or book of every single claim made in any ad ever to be retained forever," said Bartmann. "What it requires is substantiation about material statements of fact.”
Read the full article on InvestmentNews