On January 15, 2026, the SEC's Division of Investment Management updated its Marketing Compliance Frequently Asked Questions to include two new FAQs addressing key areas of the Marketing Rule (Rule 206(4)-1 under the Investment Advisers Act of 1940).
## Model Fees vs. Actual Fees in Performance Advertising
The first new FAQ addresses whether advisers must use "model" advisory fees or "actual" advisory fees when calculating net performance in advertisements. The Staff clarified that Footnote 590 of the Marketing Rule Adopting Release is not prescriptive — advisers may use various means to illustrate the effect of fee differences on performance, provided the presentation is consistent with the rule's general prohibitions against misleading information.
This is a meaningful clarification for firms that have been uncertain about whether they must always use model fees in hypothetical or extracted performance presentations. The Staff confirmed that whether the use of actual fees violates the rule depends on all facts and circumstances of a specific advertisement, including relevant disclosures.
## SRO Disqualification Conditions for Promoters
The second FAQ addresses potential self-regulatory organization (SRO) disqualifications under the testimonial and endorsement provisions of the Marketing Rule. The rule generally prohibits advisers from compensating "ineligible persons" — including those subject to certain regulatory orders — for testimonials or endorsements.
The Staff indicated it will not recommend enforcement action if an adviser compensates a promoter who is subject to an SRO final order, provided certain conditions are met: the sole reason the person is ineligible is the SRO's final order; the SRO did not expel or suspend the person from membership or bar them from association; and the person is in compliance with the terms of the SRO's final order.
## What This Means for Firms
These FAQs provide welcome flexibility on two areas that have caused practical compliance challenges since the Marketing Rule took effect. Firms should review their performance advertising practices and promoter due diligence procedures in light of this updated guidance.
> The full FAQ is available on the SEC's Division of Investment Management FAQ page at sec.gov.