A.1 CFP Board’s Code of Ethics and Standards of Conduct Flashcards
Learners will be able to identify and explain key terms and phrases associated with principles and requirements outlined in the CFP Board’s Code of Ethics and Standards of Conduct.
Define:
Fiduciary Duty
Client First Principle
The obligation to act in the best interest of the client, putting their interests ahead of the advisor’s.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
Define:
Integrity
Doing what’s right even when no one is watching.
Adhering to moral and ethical principles, being honest and transparent in all dealings.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Objectivity
Remaining impartial
Providing advice and making decisions without bias or personal interest.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Competence
Continuous learning is the key.
Possessing the necessary knowledge, skills, and expertise to provide effective financial advice.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
Define:
Fairness
Just treatment for all
Treating all clients equally and impartially, without favoritism.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
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Confidentiality
Privacy protection
Safeguarding client information and not disclosing it without proper authorization.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
Define:
Professionalism
Upholding high standards of behavior.
Conducting oneself in a manner consistent with ethical standards and industry norms.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
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Diligence
Attention to detail and thoroughness.
Performing thorough research and analysis to ensure accurate advice and recommendations.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Prudence
Acting with wisdom and discretion.
Exercising caution and good judgment in decision-making.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Conflict of Interest
Potential for divided loyalties.
Situations where a financial advisor’s personal interests may conflict with those of the client.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
Define:
Disclosure
Openness and transparency are key.
Providing full and transparent information to clients about relevant matters, including potential conflicts of interest.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Suitability
Tailoring recommendations to fit the client’s needs.
Recommending products or services that align with the client’s financial goals, risk tolerance, and financial situation.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Client-Centric
Client-focused approach.
Placing the client’s interests and needs at the center of all decision-making and actions.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
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Due-Care
Taking prudent steps to avoid errors or negligence.
Exercising the necessary caution and attention to ensure that all recommendations and actions are appropriate and well-considered.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
*Define: *
Misrepresentation
* False portrayal or deception.*
Providing false or misleading information to clients.
A.1 CFP Board’s Code of Ethics and Standards of Conduct
