Proposed
Rule 2210
Amendment

The Securities and Exchange Commission (SEC) recently issued an order instituting proceedings to determine whether to approve a proposed amendment to FINRA Rule 2210 (Communications with the Public). Currently, Rule 2210 generally prohibits member firms from predicting or projecting performance in public communications. The proposed rule change, File No. SR-FINRA-2026-004, seeks to create a new exception allowing firms to provide projected performance or targeted returns for securities or investment strategies, provided they meet specific regulatory conditions.

Under the proposed amendment, firms would be required to implement written policies and procedures reasonably designed to ensure these communications are relevant to the financial situation and objectives of the intended audience. Additionally, firms must demonstrate a reasonable basis for the criteria and assumptions used in their calculations and maintain records supporting that basis. Communications would also need to provide sufficient information to help audiences understand the risks and limitations of the projections, including the impact of fees and expenses.

Diles Consulting, led by founding principal Colleen Diles, is uniquely qualified to help firms adapt to these evolving standards, drawing on her 26 years of industry experience, including 22 years at FINRA. Our company assists clients in developing supervisory systems that are "reasonably designed" to achieve compliance, a standard Diles has expertly interpreted in high-profile regulatory cases. By providing tailored compliance solutions and producing "audit-ready" reports, Diles Consulting ensures that firms can manage complex compliance tasks—such as establishing the necessary reasonable basis for performance projections—with confidence and clarity.

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