Regulatory Wrap Episode 27: SEC Crackdown, 5 Firms Fined for Marketing Rule Violations

In Regulatory Wrap for the week to April 19, Aarti Agarwal unpicks the SEC’s charges against five investment adviser firms for violating the Marketing Rule.

24 April 2024 2 mins read
Profile picture of Kathryn Fallah By Kathryn Fallah

In Regulatory Wrap for the week to April 19, 2024:

In this Regulatory Wrap, we cover the recent Securities and Exchange Commission (SEC) enforcement actions against five investment adviser firms for advertising their hypothetical performance without having appropriate procedures established.


1. The five firms were collectively charged $200,000 for violating the Marketing Rule

2. The SEC’s Marketing Rule was implemented to manage firms’ marketing messaging and prevent misleading advertising

3. This case mirrors enforcement actions the SEC took against nine firms in September 2023, which totaled $850,000

4. Due to the two-year grace period the SEC gave firms to revise and remove non-compliant messaging, the September 2023 fines came as a shock to the industry

5. As the SEC continues to prioritize the Marketing Rule in 2024, firms must ensure they’re adhering to regulatory guidance and have amended their advertising procedures to comply

This episode is brought to you by Global Relay’s Marketing Coordinator, Aarti Agarwal.

As the SEC continues to monitor for Marketing Rule compliance, firms should ensure they’re preserving records of advertising messaging shared on social media platforms to meet regulatory requirements.