Series 65: Testimonials For Investment Advisers And Representatives

Testimonials for Investment Advisers and Representatives

Investment advisers and their representatives are generally prohibited from advertising testimonials or soliciting their clients for testimonials. In 2014, however, the SEC came out with new guidance that allows IAs and IARs to feature public testimonials that have appeared on third-party social media sites, such as Yelp, on their own social media sites. This is allowed only if all testimonials about the IA or IAR on the site are included and the site is independent from the IA or IAR. In this case, the word testimonial includes both positive and negative experiences with an adviser. The IA or IAR must not have any ability to influence the commentary on the third-party site. If the IA or IAR posts commentary on the site or influences commentary in any way, posting the testimonial would be prohibited. Also, if an IA or IAR has paid for the commentary, it cannot be used. Ratings from the third-party site may also be posted, as long as the third party developed the rating system rather than the IA or IAR.

The SEC has also said that IAs may direct customers to their own social media site (e.g., “Check us out on Facebook!”) and it wil