The SEC Marketing Rule and AI-Written Content: A Guide for Advisors

What the Marketing Rule covers

The SEC adopted the amended Marketing Rule in December 2020 (final rule release IA-5653), and advisers have had to comply since November 4, 2022. It replaced the old advertising and cash-solicitation rules with one principles-based rule for SEC-registered investment advisers.

An "advertisement" is defined broadly: generally, any direct or indirect communication an adviser makes to more than one person that offers its advisory services, plus paid testimonials and endorsements. There are exclusions, for example extemporaneous, live oral communications and most one-on-one communications. A blog post, newsletter, LinkedIn post or email sent to a list is usually in scope, whether you typed it or an AI tool drafted it. The full text is at 17 CFR 275.206(4)-1.

The seven general prohibitions, applied to AI drafts

Under the rule, an advertisement may not: (1) include an untrue statement of a material fact, or omit a material fact needed to keep a statement from being misleading; (2) include a material statement of fact the adviser can't substantiate on demand by the SEC; (3) include information likely to cause an untrue or misleading implication about the adviser; (4) discuss potential benefits without fair and balanced treatment of material risks or limitations; (5) reference specific investment advice in a way that isn't fair and balanced; (6) include or exclude performance results, or present time periods, in a way that isn't fair and balanced; or (7) otherwise be materially misleading.

AI drafts tend to trip these in predictable ways. Invented statistics (a "hallucinated" study or percentage) are untrue or unsubstantiated statements of fact. Superlatives like "the best retirement advisor in Ohio" need substantiation you probably can't produce. One-sided copy that lists the benefits of a strategy without its risks fails the fair-and-balanced test. Tell the AI tool to write [SOURCE NEEDED] instead of inventing numbers; the compliance pre-check prompt is built to catch these before your CCO does.

Testimonials, endorsements and AI-generated reviews

The rule allows testimonials, endorsements and third-party ratings, but only with conditions: required disclosures (such as whether the person is a client and whether they were compensated), oversight by the adviser and, for many paid arrangements, a written agreement. Check the SEC staff's Marketing Compliance FAQ for current staff positions.

Never ask an AI tool to write a client testimonial, a "client story" presented as real, or a review. A made-up testimonial is an untrue statement of material fact, and an AI-polished version of a real client's words should be approved by the client and your compliance team before use.

Performance and hypothetical performance

Performance has its own requirements: gross performance must be shown with net-of-fee performance, portfolio performance (other than for private funds) needs 1-, 5- and 10-year periods, and hypothetical performance (including projections and back-tests) requires policies and procedures to make sure it's relevant to the audience's likely financial situation and objectives.

Don't let an AI tool generate return figures, projections or charts for marketing. Pull numbers from your performance system, and have compliance review the presentation.

Your claims about AI are advertising too

On March 18, 2024 the SEC settled charges against two investment advisers for false and misleading statements about their use of AI. Delphia claimed to use AI and machine learning on client data in its investment process when it didn't; Global Predictions called itself the "first regulated AI financial advisor." Both were found to have violated the Marketing Rule, among other provisions, and paid $225,000 and $175,000 in civil penalties.

The SEC's fiscal 2026 examination priorities say examiners will review registrants' representations about their AI capabilities for accuracy. If your website says you use "AI-powered planning," be ready to show exactly what the tool does. Describe it plainly, for example "we use an AI notetaker to draft meeting summaries, which an advisor reviews."

Keep the final version

Advisers must keep a copy of each advertisement they disseminate under the books-and-records rule, Rule 204-2, generally for five years, the first two in an appropriate office. Archive the approved, final version of AI-assisted content the same way you archive anything else. Whether you also keep drafts and prompts is a firm-policy decision; see our guide to record-keeping for AI chats and notetakers.

If you're also FINRA-registered

Registered representatives of broker-dealers also fall under FINRA Rule 2210, which requires communications to be fair and balanced and prohibits false, exaggerated, promissory or misleading claims. In May 2024 FINRA added two AI questions to its advertising regulation FAQ: firms are responsible for the content of communications created with AI, and chatbot communications with investors must be supervised like any other correspondence or retail communication. Regulatory Notice 24-09 adds that FINRA's rules are meant to be technology neutral.

A review checklist for AI-drafted marketing

Before anything AI-assisted goes public: every number has a source you can produce; superlatives are gone unless you can substantiate them; benefits are balanced with risks; no testimonials or reviews unless they meet the rule's conditions; no performance unless it comes from approved data with the required periods and net-of-fee figures; any description of your own AI use is accurate; and the piece has been reviewed and archived under your normal process.

Tools in our compliance & marketing review category, such as Red Oak and Saifr, use AI to flag risky marketing language, and archiving tools like Smarsh and Global Relay capture the final versions. For safe first drafts, start from the compliance-safe marketing prompts.

Sources

SEC: Investment Adviser Marketing, Release IA-5653; Rule 206(4)-1 text (eCFR); Marketing Compliance FAQ; Press release 2024-36 (Delphia and Global Predictions); FY2026 examination priorities; Rule 204-2 text (eCFR).

FINRA: Rule 2210; Advertising regulation FAQ; Regulatory Notice 24-09. This guide is general information, not legal or compliance advice.