Finally! Testimonial Changes on the Horizon for Financial Advisers | Advisor Expressions
We recap some highlights of the SEC marketing rule update for investment advisers
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Finally! Testimonial Changes on the Horizon for Financial Advisers

We recap some highlights of the SEC marketing rule update for investment advisers


Modern buyers will frequently reference reviews online when buying goods or services. However, financial advisers have been left out in the cold from this prevalent part of the buying process. The SEC’s Investment Advisers Act of 1940 restricted advisers from using testimonials or endorsements. Now, the revised rule will allow advisers to include testimonials and endorsements in their advertising and marketing materials – with certain conditions of course. One of those conditions is that you provide a clear and prominent disclosure about whether the speaker or promoter is a client and whether they being paid for their comments. Keep in mind I am giving you a marketing perspective on the rule update and you will have to see what your legal and compliance personnel recommend for you.


When will this happen?

The new rules goes into effect 60 days after publication in the Federal Register. The SEC has listed the effective date of the updated rule as May 4th, 2021.

See the final rule here if you are into that sort of ‘light’ reading:


What will this mean for your practice?

The goal of this rule is to prohibit deceptive or manipulative marketing practices which is understandable. I don’t know any advisers that set out to lie or deceive their audience. They just want to be able to tell their story and share helpful information. Here are some new ways that you may be able to spread the word once this rule goes into effect AND is approved by your firm’s compliance department.


STORYTELLING: The biggest opportunity will likely be the ability to finally do some meaningful ‘storytelling’ with your messaging. People relate when their hear stories or experiences of how other people dealt with similar situations or challenges. Now, advisors will be able to have some of their clients share their experiences which can better allow prospective clients to see how an adviser can help them. For example, it could be helpful for someone to hear about a client of yours who was nearing retirement but had no idea of when they could actually afford to retire. Your client could share their story – what their concerns were, what questions they had, and how working with an advisor helped them gain clarity in what their options were. This is an honest and relatable way to share how working with you was helpful to someone.

Think of the impact this can have if you share the story of someone well-known locally who has a large following of their own! This expands your reach exponentially when shared on social media if they are OK with you tagging them or their company.


REVIEWS: Most firms I have worked with have not allowed advisers to complete a Google business profile because it allows for reviews. They have also required advisors to hide the reviews section on their company Facebook page. Once this new policy is in effect, advisers could not only open up these types of platforms to accept reviews but they can also do some campaigns to request clients to give them a review! You will need to be careful about giving away something in return for the reviews however. And you may have to publish a disclosure if you use these reviews. Check with your compliance team on the specifics.


How will this work?

There will be a transitionary period while firms update their policies and procedures and coordinating with marketing on how these changes will be launched. But keep in mind that you can’t adopt part of this new rule and not the rest! It is an all or nothing situation according to the SEC’s Q&A page. I suspect you will have to get approval from each client that gives you permission to reprint their review or if you make a video of them and you want to share it on your site or social media. You may have to ask them each year if this is OK to keep using it. Of course there is going to be more disclosure that comes along with engaging in reviews and testimonials. I always like to loop in compliance at the beginning of formulating any campaigns to know what is required upfront so I can work within the boundaries. Working closely with compliance can save you a lot of headaches and wasted time down the road!



As we see firms adopt this new rule into their policies we will keep you updated on ways advisors are utilizing it!

Want to brainstorm ideas on how you can market your practice? Contact us or set up a consultation to chat:



Excellent resources:

Here are some of the resources I have been reading that give some compliance and legal opinions.

SEC Press Release:

SEC Marketing Q&A:

FMG Podcast:

FMG Whitepaper:

TwentyOverTen Webinar:

Compliance Solutions Strategies:

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