Few tasks create more headaches for compliance officers than reviewing and approving marketing materials. As capital raising has grown more challenging in recent years, compliance officers have become inundated with requests from in-house marketers to review new or modified presentations designed to retain existing investors and secure new allocations. Due to the deliberate nature of the process, compliance is often characterized as a perennial bottleneck, yet the review of advertisements by knowledgeable compliance professionals is critical to minimizing regulatory and litigation risk to the adviser. This three-part series is dedicated to assisting managers with developing and enhancing their advertising compliance policies and practices. This first article discusses what documents fall within the advertisement definition and outlines ten best practices that managers should consider implementing when designing or evaluating their advertising review procedures. The second article
will discuss five high-risk areas within marketing materials, provide guidance to compliance officers on what to look for when encountering high-risk content and suggest ways to present this information that meet the needs of both the business development and compliance teams. The third article
will explore six different testing mechanisms firms can employ to verify compliance with their advertising procedures. See “A Roadmap for Advisers to Comply With Marketing and Advertising Regulations”: Part One
(Aug. 3, 2017); and Part Two
(Aug. 10, 2017).