FINRA’s proposal to amend Rule 2210 could mark a meaningful shift in how broker-dealers communicate with investors about projected performance and targeted returns.
Under current FINRA rules, broker-dealer communications generally may not predict or project investment performance, imply that past performance will recur, or make exaggerated or unwarranted forecasts. FINRA’s proposed amendment would create a new exception, allowing member firms to include projected performance or targeted returns for a security, portfolio, asset allocation, or investment strategy, provided that certain investor-protection conditions are met.
Those conditions are important. Broker-dealers would need written policies and procedures reasonably designed to ensure the communication is relevant to the likely financial situation and investment objectives of the intended audience. They would also need a reasonable basis for the assumptions and criteria used, retain supporting records, and provide enough information for investors to understand both the methodology and the risks and limitations of relying on projections or targets.
For private fund sponsors, placement agents, and broker-dealers, the proposal is significant because it would move FINRA’s communications framework closer to the SEC’s Marketing Rule for investment advisers. Today, advisers may be able to provide certain hypothetical performance information that broker-dealers often cannot distribute, creating practical friction in capital-raising and investor diligence. If adopted, the rule change could reduce that inconsistency while still requiring controls around audience suitability, disclosures, assumptions, and recordkeeping.
Although the original comment period closed on March 18, 2026, the SEC has now instituted proceedings to determine whether to approve or disapprove the proposed rule change and is soliciting further public input. Comments on whether the proposal should be approved or disapproved are due by June 16, 2026, with rebuttal comments due by June 30, 2026.
Comments may be submitted through the SEC’s internet comment form at sec.
Market participants who rely on broker-dealer distribution channels should consider whether to submit comments, particularly on how the rule should address retail investor communications, third-party projections, reasonable-basis diligence, back-tested performance, and consistency with the SEC Marketing Rule.