Marketing, Communications, and Sales Practice Review
The approval of communications
All marketing and client communications must be fair, balanced, and not misleading. The supervisory task is to check that performance claims are accurate and supported, that risks are disclosed with comparable prominence to returns, and that the communication does not imply guarantees. Communications include emails, social media posts, seminar materials, and oral presentations. A common trap is treating social media as outside the rulebook; it is not.
Sales practice review
Sales practice review looks at how representatives actually behave: cold calling, pressure tactics, misleading comparisons, and inappropriate cross-selling. The supervisor should sample communications and recorded calls, review complaint themes, and act on patterns. Recorded calls are a key control where the firm records them; the supervisor must know retention rules and access restrictions.
Traps to expect
Questions often present a communication that is technically accurate but omits a material risk. Omission is a misrepresentation. Another trap is a testimonial or hypothetical performance presented as if it were actual results. Hypothetical performance must be clearly labeled and must not imply that it will be achieved.
Worked example
A brochure states "our fund returned 12% last year." The correct review asks: is the figure accurate, is it net of fees, is the period identified, and is the risk disclosure equally prominent? If any element is missing, the communication must be corrected before use.
Rule of thumb
Apply the "balance test": cover the risk disclosure and remove it; would the remaining message still be accurate? If not, the communication is unbalanced.