Which States Have Adopted the SEC's New Marketing Rule for Registered Investment Advisers?

Which States Have Adopted the SEC's New Marketing Rule for Registered Investment Advisers?

The SEC’s new Marketing Rule (Rule 206(4)-1), which modernized advertising and solicitation practices for Registered Investment Advisers (RIAs), officially went into effect in November 2022 for SEC-registered firms. However, for state-registered RIAs, adoption has been far more complex and inconsistent.

While some state securities regulators quickly aligned their rules with the SEC’s approach, many others still follow older frameworks that prohibit testimonials, endorsements, and other forms of modern marketing. For RIAs that are state-registered, understanding each state's stance is critical to ensure compliant marketing practices.

Here's a summary of where things stand as of 2025.

Why This Matters

The SEC’s Marketing Rule allows practices like:- Use of testimonials and endorsements (with disclosures)- Use of third-party ratings (with conditions)- Presentation of hypothetical performance (under strict guidelines)

However, state-registered advisers are not automatically allowed to use these features unless their state regulator has adopted or incorporated the SEC’s rule.

States That Have Adopted or Incorporated the SEC Marketing Rule

A number of states have formally adopted or incorporated the SEC Marketing Rule into their own regulations.

This means that state-registered advisers in these jurisdictions can generally rely on the new rule (subject to specific state nuances):

• Alabama

• Colorado

• Kansas

• Kentucky

• Massachusetts

• Nebraska

• New Mexico

• Oklahoma

• Rhode Island

• South Carolina

• Texas (adopted February 2025)

• Utah

In these states, RIAs may generally use testimonials, endorsements, and hypothetical performance, as long as they comply with SEC Marketing Rule requirements.

States That Have Not Adopted the SEC Marketing Rule

Many states have not yet adopted the rule and still enforce older advertising standards, which generally prohibit testimonials and endorsements:

• Alaska

• Arizona

• California

• Connecticut

• Florida

• Georgia

• Hawaii

• Idaho

• Illinois

• Indiana

• Iowa

• Louisiana

• Maine

• Maryland

• Michigan

• Minnesota

• Mississippi

• Missouri

• Montana

• Nevada

• New Hampshire

• New Jersey

• New York

• North Carolina

• North Dakota

• Ohio

• Oregon

• Pennsylvania

• South Dakota

• Tennessee

• Vermont

• Virginia

• Washington

• West Virginia

• Wisconsin

Special Note: Some states, such as Oregon and Mississippi, have explicitly reaffirmed their prohibitions on testimonials, creating potential conflicts with SEC rule allowances.

States With Unclear or Ambiguous Adoption

• Wyoming: The state has not explicitly adopted or rejected the SEC Marketing Rule, leaving room for interpretation.

Caution is advised.

Key Takeaways for State-Registered RIAs

• Always check your state's specific rules before using testimonials, endorsements, or hypothetical performance in marketing.

• Do not assume SEC rule adoption applies to your state-registered firm unless confirmed by your state securities regulator.

• Document compliance: If allowed, ensure that your firm follows all disclosure and recordkeeping requirements under the SEC Marketing Rule.- Stay informed: State regulators and NASAA continue to evaluate whether to align more closely with the SEC Marketing Rule.

Final Thoughts

The adoption of the SEC Marketing Rule by state securities regulators remains a patchwork. For state-registered RIAs, compliance is complicated by the dual obligations to federal standards and varying state laws.

Until there is broader uniformity, it is vital for advisers to:

• Monitor their state’s regulatory stance regularly

• Consult compliance counsel for multi-state operations

• Avoid marketing practices that are prohibited at the state level

By staying proactive, RIAs can market effectively while avoiding costly compliance missteps.

This article is for informational purposes only and does not constitute legal advice. Always consult your compliance professional or legal counsel to understand how marketing rules apply to your firm.