What Just Happened
On December 16, 2025, the SEC's Division of Examinations published a Risk Alert titled "Additional Observations Regarding Advisers' Compliance with the Advisers Act Marketing Rule." This was the Division's third risk alert on the Marketing Rule since the rule's November 2022 compliance date — a signal that exam staff still consider RIA compliance with Rule 206(4)-1 under the Investment Advisers Act of 1940 to be a live, recurring problem, not a settled one.
The December 2025 alert zeroes in on two specific provisions: the testimonials and endorsements requirements in Rule 206(4)-1(b), and the third-party ratings requirements in Rule 206(4)-1(c). The Division made clear that it was not cataloguing every possible deficiency — the alert addresses only selected observations — and it expressly noted that deficiencies under these provisions may simultaneously constitute deficiencies under other parts of the Marketing Rule.
For CCOs who assumed their firms had this covered after the first two risk alerts, that assumption deserves a second look. The Division's consistent return to this subject — and its inclusion of Marketing Rule compliance as a named FY 2026 examination priority — means examiners are still finding problems, and they will keep looking.
What Examiners Are Actually Finding
The December 2025 Risk Alert organizes its observations around two clusters of deficiencies. Here is a plain-English breakdown of each.
Testimonials and Endorsements (Rule 206(4)-1(b)). The most frequently cited failure is missing or insufficient disclosures at the point of dissemination. Rule 206(4)-1(b) requires clear and prominent disclosures whenever an adviser uses a testimonial or endorsement — disclosures that state, at minimum, whether the person giving the testimonial is a current client, whether compensation was provided, and whether a material conflict of interest exists. Exam staff found advisers disseminating testimonials that omitted these disclosures entirely or buried them where they would not be seen.
A second recurring problem is that advisers did not recognize their own arrangements as endorsements in the first place. Examiners observed advisers that were unaware that certain promotional arrangements — including some referral and influencer relationships — met the rule's definition of an endorsement, and accordingly never entered into the written agreement that Rule 206(4)-1(b) requires with any paid promoter. No written agreement, no disclosed compensation terms, no compliance baseline.
Examiners also found advisers that paid promoters or influencers who were "ineligible persons" under the rule — for example, individuals with certain regulatory disqualifications — without conducting the due diligence required to identify that ineligibility before entering the arrangement. The rule prohibits compensating ineligible persons, so the failure to check is itself a violation.
Finally, where an endorser is affiliated with the adviser, the rule provides an exemption from certain requirements — but only if the affiliation is readily apparent to the client or investor. Examiners found advisers invoking this exemption without actually making the affiliation visible to the audience.
Third-Party Ratings (Rule 206(4)-1(c)). The Division observed advisers using third-party ratings — think award designations, "top adviser" lists, or rating service rankings — without performing adequate due diligence on the rating methodology, criteria, and any conflicts of interest in how the rating was assigned. Rule 206(4)-1(c) requires that an adviser using a third-party rating have a reasonable basis for believing the rating is clear and prominent, and includes required disclosures. Advisers were also omitting disclosure of the date on which the rating was given, which is a specific disclosure requirement under the rule.
Why This Still Matters in 2026
The Division's FY 2026 Examination Priorities, published in late 2025, continue to emphasize the effectiveness of advisers' compliance programs and explicitly flag adherence to the foundational requirements of the Advisers Act. The Marketing Rule is squarely within that frame. The tone from Chairman Atkins has been that examinations should not be a surprise exercise — but that transparency about priorities cuts both ways: firms have been on notice, and examiners will expect to see progress.
The Division has also continued to focus on advisers marketing through websites, social media platforms, influencer relationships, referral programs, and third-party marketing arrangements. If your firm uses any of those channels, your testimonial and endorsement workflow is on the examiner's radar regardless of firm size.
Separately, in January 2026 the SEC staff updated the Rule 206(4)-1 FAQ page to provide additional flexibility around how advisers may show actual fees in net performance calculations — a reminder that the Marketing Rule's interpretive landscape is still evolving and that keeping up with staff guidance is part of ongoing compliance, not a one-time exercise.
What to Do Now
The following steps are framed as actions your firm should consider, except where the rule itself mandates a specific requirement.
1. Map every testimonial and endorsement channel. Pull a current list of every place a client review, referral arrangement, influencer partnership, or similar promotional content appears — your website, Google Business Profile, social media pages, podcast guest spots, and any third-party platforms. The rule applies to all of these. Many of the exam findings arose because firms simply were not tracking all the channels where client-sourced content was running.
2. Audit written agreements with paid promoters. Rule 206(4)-1(b) requires a written agreement with any compensated promoter. Review each arrangement to confirm a compliant written agreement is in place, that it addresses the Marketing Rule's specific requirements, and that it has not lapsed or been superseded by informal side arrangements. If any compensated arrangement lacks a written agreement, treat remediation as mandatory, not optional — the rule requires it.
3. Confirm disclosure language and placement. Each testimonial or endorsement must include clear and prominent disclosure of client status, compensation, and material conflicts. Consider reviewing actual consumer-facing placements, not just your template language, to verify the disclosures appear in context and are not buried in footnotes or linked-away.
4. Check promoter eligibility before any new arrangement. Before entering or renewing any compensated testimonial or endorsement arrangement, confirm that the promoter is not an "ineligible person" under the rule. Document that review. Given the compliance date is now more than two years in the past, there is no examination defense for skipping this step.
5. Audit third-party ratings in use. For every award badge, rating, or ranking your firm uses in any marketing material, document your due diligence on the rating criteria and any conflicts of interest in the rating process. Confirm required disclosures — including the date of the rating — are present. Consider removing or pausing use of any rating where you cannot support the due diligence in writing.
6. Update your Rule 206(4)-7 annual review to include these findings. Rule 206(4)-7 under the Advisers Act requires an annual review of the adequacy and effectiveness of your compliance policies and procedures. The Division's Risk Alert expressly notes that advisers should consider interim reviews of their policies and procedures in response to regulatory developments. Consider using the December 2025 alert as a specific input in your next annual review and documenting that you did so.
7. Review the updated Rule 206(4)-1 FAQs. Staff updated the FAQ page in January 2026. If your policies or performance advertising practices have not been checked against the current FAQ guidance, add that to your review queue.
The Bottom Line
Three risk alerts on the same rule in three years is not a coincidence. The Division has told the industry, in plain terms, where the compliance gaps are. The December 2025 alert is specific enough to serve as a self-audit checklist right now: testimonial disclosures, written promoter agreements, eligibility checks, and third-party rating due diligence. If your firm cannot produce documentation on each of those four items today, you have found your gap before an examiner does — which is exactly the outcome the Division says it wants. Use that window.