The SEC’s Division of Examinations has released a Risk Alert, sharing initial observations from examinations of investment advisers’ compliance with the Marketing Rule, on which the Division will continue to place emphasis.
The Risk Alert offers comprehensive observations of investment adviser compliance with the Compliance Rule, General Prohibitions of the Marketing Rule, and the Books and Records Rule. The Risk Alert encourages both compliance with these rules and accurate completion of the Marketing Rule items within Form ADV.
In connection to the Marketing Rule’s General Prohibitions, the Risk Alert provides observations of insufficiencies related to the following:
- untrue statements of material fact and unsubstantiated statements of material fact
- omission of material facts or misleading inference
- fair and balanced treatment of material risks or limitations
- references to specific investment advice that were not presented in a fair and balanced manner
- inclusion or exclusion of performance results or time period in matters that were not fair and balanced
To view the full Risk Alert announcement, please visit the SEC’s website.
Sources:
Risk Alert: Initial Observations Regarding Advisers Act Marketing Rule Compliance (sec.gov)
Division of Examinations Risk Alert (sec.gov)
