While there was time to prepare before the SEC’s new Marketing Rule was effective, since its compliance date over six months ago, much has been learned to assist firms now. Industry and regulatory feedback about compliance with the rule was the subject of a recent NSCP educational seminar. The seminar included FrontLine Compliance Founder and President Amy Lynch as a featured panelist, and her insights on the Marketing Rule are shared within the Private Equity Law Report article. The coverage of Ms. Lynch’s presentation includes her guidance on many facets of the rule and the likely areas where the SEC will focus during an exam. She expects the SEC to ask firms about how they implemented the rule, request firm training materials on the rule, as well as drill down on the requirements for the use of hypotheticals and performance advertising, including the relevant disclosures. Ms. Lynch further explains the SEC’s approach to its marketing material substantiation requirement and recommends compliance have a role in regular and periodic reviews of the materials and the backup to substantiate claims. She adds that firms should be testing to ensure new policies and procedures are being adhered to and marketing reviews are occurring as they should. Ms. Lynch also notes that FrontLine’s clients are already undertaking additional “phase two” testing to see how their updated practices are operating, and encourages all firms to continuously update and revise their policies, procedures and processes as they learn what it really means to live with the new rule.
See Private Equity Law Report (subscription required), “Challenges and Lessons From the First Six Months of Complying With the New Marketing Rule”
Also, see our Events posting “Seminar features Amy Lynch on marketing rule best practices”
