States look to mirror success of SEC’s Marketing Rule (FinancialPlanning)

The North American Securities Administrators Association (NASAA) has issued a proposal on a model rule for states to adapt their marketing and advertising regulations to the SEC’s Marketing Rule. Amy Lynch, FrontLine’s Founder and President thinks that would be a step in the right direction and believes the SEC’s rule has largely been a success. With the lead quotes in the Financial Planning article, Ms. Lynch highlights how the Marketing Rule should be credited with consolidating the restrictions on investment advisers’ advertisements that were previously interpreted through an array of documents or “no-action letters,” helping to simplify what SEC advisers can use in marketing materials. Now NASAA’s proposal would seek a similar way to simplify state requirements, when currently state-registered investment advisers many times have to comply with a different set of marketing and advertising rules when branching into a new state. Ms. Lynch adds that the SEC’s examinations for Marketing Rule compliance need more uniformity across its exam teams, particularly when reviewing firms’ use of hypothetical performance. But despite a few flaws, she sees overall improvement from predecessor regulations, and since state-registered entities are doing the same marketing activities, even though on a lesser scale, she believes they should have the same set of rules. See Financial Planning (limited guest subscription), “NASAA proposal seeks to harmonize state, SEC marketing rules”