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SEC to Vote on Long-Awaited Ad Rule Changes Next Week

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SEC headquarters in Washington SEC headquarters in Washington. (Photo: Diego Radzinschi/ALM)

The Securities and Exchange Commission plans to take up Wednesday long-awaited changes to its advertising and marketing rules.

(Related: Updates to Custody, Ad Rules Nearing the Finish Line)

The commission will consider whether to adopt amendments under the Investment Advisers Act of 1940 to update rules that govern investment advisor marketing “to accommodate the continual evolution and interplay of technology and advice, while preserving investor protections,” the agency said.

Amendments to Form ADV, the agency said, will also be considered to provide the commission with additional information about advisors’ marketing practices, and corresponding amendments to the books and records rule under the Advisers Act.

Karen Barr, president and CEO of the Investment Adviser Association in Washington, told ThinkAdvisor on Thursday in an email that IAA is “pleased to see that the SEC will be able to adopt rules before year-end to modernize the advertising rules for advisors — which have not been updated substantively since 1961.”

IAA, Barr said, commends SEC staff “for their diligent efforts to get this rulemaking out the door” and is looking forward to seeing the final rules.

Dalia Blass, director of the SEC’s Division of Investment Management, said earlier this year that changes to the investment advisor advertising and solicitation rule would come sometime this year.

Blass explained that the proposal affects “a diverse community” of investment advisors with retail and institutional investors as clients as well as private funds and robo-advisors.

Putting the advertising rule changes together “was not an easy task,” considering the rule predated the internet as well as other market and technology developments, she said “It was one of the harder proposals for us to bring together.”

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