To verify that a financial advisor and/or wealth management firm has earned an award from Wealthtender, view their profile(s) on Wealthtender and scroll down to the Awards tab. Within the Awards tab, look for the Wealthtender Awards area where awards issued by Wealthtender will appear.

• Find a financial advisor profile
• Find an advisory firm profile

In certain circumstances, a financial advisor or wealth management firm may have earned an award from Wealthtender that does not appear in the Awards tab.

If an award you expected to find in the Awards tab for a wealth management firm or financial advisor doesn’t appear on their profile, please contact yourfriends@wealthtender.com and we’ll be happy to assist.

Both the Securities and Exchange Commission (SEC) and FINRA have provided guidance to help financial advisors and registered representatives understand how they can utilize third-party ratings, subject to certain conditions. The summary below highlights a few important areas of guidance found in the SEC Marketing Rule and FINRA Rule 2210 that must be followed by financial advisors when utilizing third-party ratings.

For a more complete discussion regarding the regulatory requirements and tips for compliantly promoting third-party ratings, please read this article.

SEC Marketing Rule

The SEC recognizes that marketing activities conducted by financial advisors are “an essential part of retaining and attracting clients and may be conducted easily through the internet and social media.” ¹ In fact, the SEC estimated in the Marketing Rule Adopting Release that approximately 50 percent of financial advisors will use third-party ratings in advertisements, reflecting their understanding about the important role that third-party ratings play among consumers making hiring decisions.

To provide financial advisors with a blueprint for compliantly promoting third-party ratings, the SEC Marketing Rule permits financial advisors to use third-party ratings in marketing and advertising activities when certain conditions are met, including:

• Clear and prominent disclosure indicating:
  • The date on which the rating was given 
  • The period of time upon which the rating was based
  • The identity of the third-party that created and tabulated the rating
  • (If applicable) That compensation has been provided directly or indirectly by the financial advisor in connection with obtaining or using the third-party rating 
• Financial advisors must have a reasonable basis for believing the questionnaire or survey used to prepare the rating meets certain criteria, including making it “equally easy for a participant to provide favorable and unfavorable responses”
• The firm publishing the rating can not be affiliated with the financial advisor and must be in the business of preparing ratings in their ordinary course of business

For an expanded discussion of SEC conditions and disclosure requirements related to the use of third-party ratings, please read this article.

FINRA Rule 2210

Financial advisors who are registered representatives of broker-dealers must abide by FINRA Rule 2210 that governs communications with the public, including the use of third-party ratings and awards.

Financial advisors who are dually SEC and FINRA registered must abide by all SEC Marketing Rule Requirements, in addition to the regulations prescribed by FINRA Rule 2210.

Many of FINRA’s requirements are similar to those found in the SEC Marketing Rule, therefore best practices for advisors subject to FINRA oversight include establishing a compliance program for third-party ratings and awards designed to satisfy the requirements of both the SEC Marketing Rule and FINRA Rule 2210.

For an expanded discussion of FINRA conditions and disclosure requirements related to the use of third-party ratings, please read this article.

¹ Notice by the Securities and Exchange Commission on 07/01/2024

The SEC Marketing Rule states that financial advisors must perform due diligence to establish “a reasonable basis to believe that any questionnaire or survey used in the preparation of the third-party rating is structured to make it equally easy for a participant to provide favorable and unfavorable responses, and is not designed or prepared to produce any predetermined result.”

In its adopting release, the SEC states: “an adviser could satisfy the [due diligence] requirement by accessing the questionnaire or survey that was used in the preparation of the rating.”

Wealthtender published this informational page (including this response and related FAQs) to assist financial advisors and compliance professionals with satisfaction of the due diligence requirement for Wealthtender awards. Additionally, Wealthtender prepared this Regulatory Due Diligence Guide in PDF format we think you will find useful.

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Effectively, the two due diligence questions and responses to satisfy this requirement can be summarized as follows:

SEC Question 1: Does the Wealthtender questionnaire or survey used in the preparation of its ratings/awards make it equally easy for a participant to provide favorable and unfavorable responses?

Wealthtender Response: Yes. The Wealthtender Voice of the Client Awards recognize financial advisors and wealth management firms that consistently receive superior client reviews. The Wealthtender review submission form (see screenshot below) is designed to satisfy this regulatory requirement by making it equally easy for clients of financial advisors to provide favorable or unfavorable responses. Using the industry standard “five-star” rating system for client reviews, it is equally easy for a client to rate an advisor “1-star” or “5-stars”. In addition, the labels and “helper text” displayed in the review form encourage “useful” and “genuine” responses to avoid the appearance of encouraging only “positive” responses.

SEC Question 2: Is the Wealthtender questionnaire or survey designed not to produce any predetermined result?

Wealthtender Response: Yes. The Wealthtender review submission form (see screenshot below) is designed not to produce any predetermined result. Further, an individual client review itself cannot result in an advisor qualifying for a Wealthtender award. Only upon satisfying the criteria for the applicable Wealthtender award and receiving at least the minimum number of award-eligible reviews can an advisor qualify for a Wealthtender award.

Screenshot of the Wealthtender Review Submission Form:

Both the SEC and FINRA provide important guidance that financial advisors must follow when publishing and promoting third-party ratings and awards. 

The summary below highlights a few important areas of guidance related to disclosure requirements found in the SEC Marketing Rule and FINRA Rule 2210 that must be followed by financial advisors when promoting third-party ratings/awards.

For a more complete discussion regarding the regulatory disclosures required when promoting third-party ratings, please read this article.

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SEC: DISCLOSURES REQUIRED WHEN PROMOTING THIRD-PARTY RATINGS

The SEC Marketing Rule requires that a) financial advisors “clearly and prominently disclose”, or b) financial advisors “reasonably believe that the third-party rating issuer clearly and prominently discloses”:

• The date on which the rating was given and the period of time upon which the rating was based
• The identity of the third-party that created and tabulated the rating
• (If applicable) That compensation (cash or non-cash) has been provided directly or indirectly by the financial advisor in connection with obtaining or using the third-party rating

To satisfy the requirement to “clearly and prominently” display disclosures, it’s important to note these disclosures must be displayed alongside or in very close proximity to the published rating/award. Financial advisors cannot link to disclosures on another page to satisfy this requirement.

FINRA: DISCLOSURES REQUIRED WHEN PROMOTING THIRD-PARTY RATINGS

FINRA requires that advertisements and communications to a retail audience promoting third-party ratings prominently disclose the name of the advisor and/or their firm, the name of the organization that issued the rating/award, and the nature of the relationship between the advisor and the third-party rating firm.

Additionally, because third-party ratings/awards could be construed as a form of ‘testimonial’, financial advisors should incorporate the disclosure requirements for testimonials outlined in FINRA Rule 2210 as a matter of good practice, including:

• The fact that the rating/award, often assessed with a historical lens, may not be representative of the experience of all past or future customers,
• The fact that the rating/award should not be construed as a guarantee of future performance or success, and
• If more than $100 in value is paid to be considered for the award or to promote the award, the fact that payment was made for the rating/award

Further, financial advisors must ensure that any promotion of ratings/awards are approved by an appropriately qualified Registered Principal before use or filing with FINRA’s Advertising Regulation Department.

Wealthtender only displays Wealthtender awards on the Wealthtender profiles of qualifying advisors and wealth management firms after the qualifying advisor/firm:

a) accepts their award, and

b) either acknowledges the default disclosures that Wealthtender publishes to satisfy SEC and FINRA disclosure requirements (see table below) or provides alternative disclosures to satisfy disclosure requirements.

For additional resources to support your compliance responsibilities, Wealthtender prepared this Regulatory Due Diligence Guide in PDF format we think you will find useful.