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How far can RIAs go with advertisements?

Don't take your cues from restaurants or lawyers

Thursday, July 15, 2010 – 6:54 AM by Les Abromovitz, Guest Columnist
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Les Abromovitz: Back when I went to law school, attorneys didn’t advertise on television, let alone on urinals.

Mentioned in this article:

NCS Regulatory Compliance
Consulting Firm
Top Executive: Mark Alcaide, COO/Partner



June 21, 2011 — 6:07 PM

Your comments above in the section entitled “Don’t Forget You’re a Fiduciary” are 100% wrong. When it comes to advertising rules, we are not fiduciaries. A person or company becomes a fiduciary in connection with an EXISTING investment advisory relationship, not as a result of sending out or creating marketing materials.

Les Abromovitz

Les Abromovitz

June 21, 2011 — 8:05 PM

The fiduciary duty owed by investment advisers arises from Section 206 of the Investment Advisers Act. Here are a few sentences from Section 206:

Section 206 — Prohibited Transactions by Investment Advisers
It shall be unlawful for any investment adviser, by use of the mails or any means or instrumentality of interstate commerce, directly or indirectly—

a.to employ any device, scheme, or artifice to defraud any client or prospective client;

b.to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client;

I believe RIAs and IARs should view themselves as fiduciaries at all times, whether they meet the legal definition or not. I would argue that if they deviate from the fiduciary standard of full disclosure while courting clients, they will cause themselves significant problems down the road. I would hate to think that IARs tell themselves they are not a fiduciary yet, so they can be less than forthcoming in their marketing efforts and interactions with prospective clients.

Brooke Southall

Brooke Southall

June 21, 2011 — 10:17 PM


Thanks for elaborating on this point.


David P

David P

February 11, 2020 — 2:56 AM
Based on your comment, it appears that donating a free planning session to a school silent auction is acceptable. Can't imagine why it wouldn't be but with the amount of specific regulation in this field, I wanted to be sure.

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