Compliance
What is Testimonial & Endorsement Disclosure?
Testimonial and endorsement disclosure refers to the SEC Marketing Rule requirements that advisers clearly and prominently disclose key facts when using client testimonials or third-party endorsements in advertising.
Since the Marketing Rule took effect, registered investment advisers may use testimonials and endorsements — which was previously restricted. In exchange, specific disclosures are required: whether the person is a client, whether they were compensated, and any material conflicts of interest.
Advisers must also meet oversight conditions and, in many cases, have a written agreement with compensated promoters, and they must observe the rule's disqualification provisions.
This is general information, not legal or compliance advice. Work with your compliance team to implement the exact disclosures and agreements your situation requires.
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