Financial Fundamentals - Ch 16

Question 1

Standards of Professional Conduct - consist of 3 parts ?

Answer 1

CODE of Ethics and Standards of Conduct

Procedural RULES

Candidate FITNESS Standard.

Question 2

The Code and Standards includes
the Code of Ethics and Standards of Conduct. ?

a. True b. False

Answer 2

TRUE
Code of Standards - contains
- Code of Ethics
- Standards of Conduct

Question 3

What are the 2 areas of the Standards of Conduct and their underlying PRINCIPALS ?

Answer 3

Principals for the “Standards of Conduct “ includes 2 areas :

Fiduciary Duty Duties to clients
——————— ———————–
Loyalty Integrity
Care Competence
Prudence Diligence
Objectivity
Confidentiality

Question 4

Define a client ?

Answer 4

Client. - Any person, including a natural person, business organization, or legal entity, to whom the CFP® professional provides or agrees to provide Professional Services pursuant to an Engagement

Question 5

Define conflict of interest ?

Answer 5

Conflict of Interest.

1. CFP® professional’s interests (including the interests of the CFP® Professional’s Firm) are ADVERSE TO THE CFP® professional’s duties to a Client
2. CFP® professional has duties to one Client that are ADVERSE to ANOTHER CLIENT.

Question 6

How does the CFP board define Family ?

Answer 6

Family. -
Grandparent, parent, stepparent, father-in-law/mother-in-law,

uncle/aunt, spouse, former spouse, spousal equivalent, domestic partner,

brother/sister, step-sibling, brother-in-law/sister-in-law,

cousin, son/daughter, stepchild, son-in-law/daughter-in-law, nephew/niece, grandchild, and any other person the CFP® professional, directly

or indirectly, supports financially to a material extent.

Question 7

What 3 things define acting as with a Fiduciary DUTY ?

Answer 7

Fiduciary Duty

1. Duty of LOYALTY
   
   • Clients interest first
   • Avoid conflicts of interest
   • Act without regard to your financial interest
2. Duty of CARE
   
   • Act with Care, Skill and Prudence
3. duty to FOLLOW client instructions.
   
   • That are reasonable and lawful

Question 8

Define Financial Advice ?

Answer 8

Financial Advice.
a. Communication based on - Content, Context, and Presentation, would reasonably be viewed as Recommendation that the Client take or refrain from
taking a particular course of action with respect to:
1. Development or implementation of a financial plan
2. Value of or the advisability of investing in, purchasing,
holding, gifting, or selling Financial Assets;
3. Investment policies or strategies, portfolio composition, the
management of Financial Assets, or other financial matters;
4. Selection and retention of other persons to provide financial
or Professional Services to the Client; or
b. The exercise of discretionary authority over the Financial Assets of a Client.

The more individually tailored the communication is to the Client, the more likely the communication
- will be viewed as Financial Advice

Question 9

Define Financial Planning ?

Answer 9

Financial Planning -

COLLABORATIVE process that ,,

helps MAXIMIZE a Client’s potential for meeting LIFE GOALS
through Financial Advice,,

that integrates relevant elements of the Client’s personal and financial circumstances.

Question 10

What are the 15 Duties Owed to Clients ?

Answer 10

Fiduciary Duty
Integrity
Competence
Diligence
Disclose and mange conflicts of Interest
Sound and Objective Professional Judgement
Professionalism
Comply with the Law
Confidentiality and Privacy
Provide Information to the Client
Duties when Communications with a client
Duties when representing compensation method
Duties when recommending, engaging, & working w/ add’ l
persons
Duties when selecting, using, and recommending technology
Refrain from borrowing or lending money and commingling
financial assets

Question 11

Define Integrity ?

Answer 11

Integrity
A CFP® professional must perform Professional Services with integrity. Integrity demands honesty and candor, which may not be subordinated to personal gain or advantage.

May not, directly or indirectly, in the conduct of Professional Services:
- Employ any device, scheme, or artifice to defraud;
- Make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not mis-leading
- Engage in any act, practice, or course of business which operates or would operate as a fraud

Question 12

Define Competence

Answer 12

Competence
-Which means with relevant knowledge and skill to apply that knowledge.

-When the not sufficiently competent in a particular area to provide the Professional Services required under the Engagement,
- CFP® professional must gain competence,
- Obtain the assistance of a competent professional
- Limit or terminate the Engagement, - and/or refer the Client to a competent professional.

Question 13

Define Diligence

Answer 13

Diligence
-CFP® professional must provide Professional Services, including responding to reasonable Client inquiries, in a

timely and thorough manner.

Question 14

What does it mean to Disclose and manage conflicts of interest ?

Answer 14

Disclose Conflicts and manage conflicts of interest :

When providing Financial Advice, a CFP® must make full disclosure of all Material Conflicts of Interest with the Client that could affect the professional relationship.
- Full disclosure & obtain consent of the Client before providing any Financial Advice.
- Evaluate whether a reasonable Client receiving the disclosure would have understood the conflict & how it could affect the advice the Client will receive from the CFP®
- Oral disclosure of a conflict will be given such weight as CFP Board in its judgment deems appropriate. Written consent to a conflict is not required

Manage Conflicts.
-CFP® must ADOPT and FOLLOW BUSINESS PRACTICEs reasonably designed to PREVENT Material Conflicts of Interest from compromising the CFP® ability to act in the Client’s best interests

Question 15

Define Sound and Objective Professional Judgement

Answer 15

Sound and Objective Professional Judgment
-CFP® must exercise professional judgment on behalf of the Client that is not subordinated to the interest of the CFP®

-may NOT solicit or accept any gift, gratuity, entertainment, non-cash compensation, or other consideration that reasonably could be expected to compromise the CFP® objectivity

Question 16

Define Professionalism

Answer 16

CFP®
-must treat Clients, prospective Clients, fellow professionals, and others with dignity, courtesy, respect.

Question 17

The Standards of Conduct consist of 6 parts ?

Answer 17

STANDARDS OF CONDUCT
Standards of Conduct consists of:
A. Duties owed to clients
B. Financial planning and application of the Practice Standards for the
financial planning process
C. Practice standards for the financial planning process
D. Duties owed to firms and subordinates
E. Duties owed to CFP board
F. Prohibition on circumvention

Question 18

What is in the PREAMBLE of the Standards of Conduct ?

Answer 18

PREAMBLE
* Compliance with the Code and Standards is a requirement of CFP®
certification
* Violation may subject the CFP ® professional to discipline

Question 19

What are the duties owed to clients ?

Answer 19

DUTIES OWED TO CLIENTS
1. Fiduciary Duty
2. Integrity
3. Competence
4. Diligence
5. Disclose and manage conflicts of interest
6. Sound and objective professional judgement
7. Professionalism
8. Comply with the LAW
9. Confidentiality and privacy
10. Provide Information to a client
11. Duties when communicating with a client
12. Duties when representing compensation method
13. Duties when recommending engaging, and working with add’l persons
14. Duties when selecting, using, and recommending technology
15. Refrain from borrowing or lending money and commingling financial assets

Question 20

For duties owed to clients what is the fiduciary Duty ?

Answer 20

DUTIES OWED TO CLIENTS:
FIDUCIARY DUTY
* When providing Financial Advice to a Client, a CFP®
professional must act as a fiduciary, and therefore, act in the best
interests of the Client.
Following duties must be fulfilled:

• Duty of Loyalty
• Place client interest ahead of own
• Avoid, or disclose and manage, conflicts of interest
• Act in the best interest of the client
• Duty of Care
• Duty to Follow Client Instructions

Question 21

Define Financial Advice

Answer 21

PROVIDING FINANCIAL ADVICE TO CLIENTS

• A person to whom the CFP® professional AGREES to provide professional services pursuant to an engagement.
  Financial Advice
• RECOMMENDATION that the Client take or refrain from taking a particular
  course of action with respect to:
• Development or implementation of a FINANCIAL PLAN,
• Investing in, BUYING , holding, gifting, or selling
  Financial Assets,
• Investment policies or strategies, portfolio composition, the
  management of financial assets, or other financial matters,
• Selection and retention of other persons to provide financial or
  professional services to the client.
• Exercise of discretionary authority over the financial assets of a client

Question 22

What amount of CE is required for maintaining your CFP ?

Answer 22

30 hours of Ce , which includes 2 hours of Ethics

Question 23

What are the Duties owed to clients to disclose and manage conflicts of interest ? ?

Answer 23

DUTIES OWED TO CLIENTS: DISCLOSE AND
MANAGE CONFLICTS OF INTEREST

• When an actual or potential conflict of interest arises, the CFP®
  professional must:
  1. Disclose the conflict,
  2. Obtain the client’s informed consent, and
  3. Manage the conflict in the client’s favor.
• Disclosure may be made orally or in writing when providing Financial

Advice or Financial Planning.
* If made orally, the CFP® professional must document the fact that
the information was provided.
* CFP Board suggests, as a best practice, that CFP® professionals
provide the disclosure in writing

Question 24

What are the duties owed to clients for Confidentiality and Privacy ?

Answer 24

DUTIES OWED TO CLIENTS: CONFIDENTIALITY
AND PRIVACY
* Keep client information confidential, except:
* For ordinary business purposes
* For legal and enforcement purposes

• Do NOT use any non-public personal information about a client for
  personal benefit, unless the client consents.
• Do take reasonable steps to protect the security of non-public
  personal information about any client.
• Adopt and implement policies regarding the protection, handling,
  and sharing of a client’s non-public personal information.
• Must provide a client with written notice of those policies both
  At the time of the engagement, and at least annually

Question 25

What are the duties owed to clients for Providing information to clients when providing financial advice?

____________________________________________________________

When providing Financial Planning ?

Answer 25

DUTIES OWED TO CLIENTS: PROVIDE
INFORMATION TO A CLIENT
a. When providing financial advice that does not require financial
planning:

i. Description of the services and products to be provided.
ii. How client pays for the products and services.
iii. How the CFP®, the CFP® firm,and any related party are compensated.
iv. The existence of any public discipline or bankruptcy.

_____________________________________________________

b. When providing financial planning:

-Information required to be provided above.
-Terms of the engagement between the Client and the CFP

c. Updating information

Question 26

Duties owed to clients : What are the Duties when representing compensation ?

Answer 26

DUTIES OWED TO CLIENTS: DUTIES WHEN
REPRESENTING COMPENSATION METHOD
___________________________________________________________________
FEE- ONLY
* CFP® & the CFP® firm receive NO sales-related compensation; and
* Related parties receive NO sales-related compensation in connection with any professional services the CFP® professional or firm provides to clients.
___________________________________________________________________
FEE_BASED (fee and commission)
* Must make clear that the CFP® professional and/or firm is not fee-only or that the CFP® professional and/or firm earns fees and commissions.

Question 27

Duties owed to clients: What are the duties when recommending, engaging, and working with add’l persons ?

Answer 27

DUTIES OWED TO CLIENTS: DUTIES WHEN
RECOMMENDING, ENGAGING, AND WORKING
WITH ADDITIONAL PERSONS

CFP® professional must:
* Have REASONABLE BASIS for the recommendation based on the
person’s reputation, experience, and qualifications; and
* DISCLOSE any compensation paid to the CFP ® professional by the
person recommended or engaged.

• When working w/another professional on behalf of client, CFP® must:
  
  • Clarify the scope of their respective services and the allocation of
    responsibility between them; and
• Inform the client if the CFP® professional believes the other
  provider’s services were not performed in accordance with the scope
  of services to be provided and the allocation of responsibilities

Question 28

Duties owed to clients: What are the duties when selecting , using, and recommending technology ?

Answer 28

DUTIES OWED TO CLIENTS: DUTIES WHEN
SELECTING, USING, AND RECOMMENDING
TECHNOLOGY
* Exercise reasonable care and judgment when selecting, using, or
recommending any software, digital advice tool, or other technology.
* Have a reasonable level of understanding of the assumptions and
outcomes of the technology employed.
* Have a reasonable basis for believing that the technology produces
reliable, objective, and appropriate outcomes.

Question 29

Duties owed to clients: Refrain from borrowing or lending money and commingling financial assets.

Answer 29

DUTIES OWED TO CLIENTS: REFRAIN FROM
BORROWING OR LENDING MONEY AND
COMMINGLING FINANCIAL ASSETS
* A CFP® professional may not, directly or indirectly, borrow money from or
lend money to a client unless:
* The client is a member of the CFP® professional’s family; or
* The lender is a business organization or legal entity in the business
of lending money.
* No commingling of client assets with assets of the CFP® professional or
firm.

Question 30

What is Financial Advice ?

Answer 30

FINANCIAL ADVICE ________________________________
* Communication that, based on its Content, Context,
and Presentation, would reasonably be viewed as a
recommendation that the Client take or refrain from
taking a particular course of action with respect to:
- Development or implementation of a Financial Plan;
- Value of or the advisability of investing
in, purchasing, holding, gifting, or selling
Financial Assets;
- Investment policies or strategies, portfolio
composition, the management of Financial
Assets, or other financial matters; or
- Selection and retention of other persons
to provide financial or Professional Services to
the Client; or
* Exercise of discretionary authority over the
Financial Assets of a Client.

Question 31

What is NOT financial Advice ?

Answer 31

• Communication that, based on its content, context,
  and presentation, would not reasonably be viewed as
  a recommendation;
• Responses to directed orders;
• The following, if a reasonable CFP® professional
  would not view it as Financial Advice:
• Marketing Materials;
• General Financial Education; and
• General Financial Communications.

Question 32

What defines “Financial Planning” engagement ?

Answer 32

If the answer to any of the following is YES, then this is a Financial Planning Engagement, and you must comply with the
Practice Standards for the Financial Planning Process.

1. Have I agreed to provide or have I provided Financial Planning?
2. Does the Financial Advice I agreed to provide require integration
   of relevant elements of the Client’s personal and/or financial
   circumstances in order to act in the Client’s best interests, taking
   into account the Integration Factors set forth to the right?
3. Does the Client have a reasonable basis to believe that I will
   provide or have provided Financial Planning?

Question 33

What are the required disclosures for Providing Financial advice vs Financial Planning ?

Answer 33

Privacy Policy in WRITING in WRITING
Conflicts of Interest oral or in writing oral or in writing
Services and Products same in WRITING
How clients pays same
How CFP comp
Public Discipline
Referral Comp
Material info.
Terms of engagement
Implementation of responsibilities
monitoring and updating responsibility

Question 34

What is the definition of Financial Planning ?

Answer 34

Financial Planning Definition

A COLLAORATIVE process that helps maximize a client’s potential for
MEEETING LIFE GOALS through
FINANCIAL ADVICE that
INTEGRATES the relevant elements of the client’s personal and financial circumstances

Question 35

A CFP® professional must comply with the Practice Standards
when: ?

Answer 35

• A CFP® professional must comply with the Practice Standards
  when:
• The CFP® agrees to provide or provides
• Financial planning; or
• Financial advice that requires integration of relevant
  elements of the client’s personal and/or financial
  circumstances in order to act in the client’s best interests, or
• The client has a reasonable basis to believe the CFP®
  professi

Question 36

What are the Integration factors for the application of the practice standards ?

Answer 36

FINANCIAL PLANNING AND APPLICATION OF
THE PRACTICE STANDARDS (4 OF 5)
Integration Factors
* The number of relevant elements
* The portion and amount of the client’s financial assets affected
* The length of time the client’s may be affected by the advice
* The effect on the client’s overall exposure to risk
* The barriers to modifying the actions taken to implement the
financial advic

Question 37

What are the options when you cannot enter into an agreement to engage for Financial Planning ?

Answer 37

No Client Agreement to Engage for Financial Planning

• If a CFP® professional otherwise must comply with the Practice
  Standards, but the client does not agree to engage the CFP®
  professional to provide financial planning, the CFP® professional must either:

a. Not enter into the engagement; or
b. Limit the scope of engagement; or
c. Provide the requested services after educating the client of the
benefits of financial planning
* the CFP® professional is not required to comply with the
Practice Standards in the case; or
d. Terminate the engagement

Question 38

Whats the 7 steps to the Financial Planning Process ?

Answer 38

PRACTICE STANDARDS FOR THE FINANCIAL
PLANNING PROCESS

1. Understanding the client’s personal and financial circumstances
2. Identifying and selecting goals
3. Analyzing the client’s current course of action and potential
   alternative course(s) of action
4. Developing the financial planning recommendation(s)
5. Presenting the financial planning recommendation(s)
6. Implementing the financial planning recommendation(s)
7. Monitoring progress and updating

Question 39

What are the CFP duties to the Firms and subordinates ?

Answer 39

DUTIES OWED TO FIRMS AND SUBORDINATES
* Use reasonable care when supervising
* Comply with lawful objectives of CFP® professional’s firm
* Provide notice of public discipline
* A CFP® professional must promptly advise the CFP®
professional’s firm, in writing, of any public discipline imposed by
CFP Board.

Question 40

What are the duties to the CFP Baord ?

Answer 40

DUTIES OWED TO CFP BOARD
* Refrain from adverse conduct
* A CFP® professional may not engage in conduct that reflects
adversely on his or her integrity or fitness as a CFP® professional,
upon the CFP® marks, or upon the profession. Such conduct
includes, but is not limited to, conduct that results in:
-A felony or relevant misdemeanor conviction
- Finding in a regulatory action or a civil action that the CFP®
professional engaged in fraud, theft, misrepresentation, or other
dishonest conduct
- A personal bankruptcy or business bankruptcy
-A federal tax lien on property owned by the CFP® professional
- A non-federal tax lien, judgment lien, or civil judgment
* Reporting
* Written notice to CFP Board within 30 calendar days
* Cooperation

Question 41

What are teh procedural rules for sanctions against a CFP for wrong doing ?

Answer 41

PROCEDURAL RULES: FORMS OF SANCTION
Forms of Sanction:
* Private Censure - minor, send letter, not published
* Public Censure - worse, report on website
* Suspension - up to 5 years
* Revocation - PERMANENT. No exception.
* Interim Suspension - when accused of something that is a danger to public, so they suspend then start investigation.

Question 42

Whats the 3 categories to adverse conduct for the Fitness Standards to becoming a CFP ?

Answer 42

CANDIDATE FITNESS STANDARDS
* Three categories of adverse conduct:
* Conduct that is unacceptable
* Conduct that is presumed to be unacceptable
* Other conduct that may reflect adversely upon the individual’s
integrity or fitness, the profession, or the CFP® marks

Question 43

Whats is the ALWAYS BAR list for CFPs ?

Answer 43

ALWAYS BAR LIST
* Unacceptable conduct that will always bar an individual from
becoming certified includes:
* Felony conviction for theft, embezzlement or other financially-
based crimes
* Felony conviction for tax fraud or other tax-related crimes
* Revocation of a financial professional license, unless
revocation was administrative in nature
* Felony conviction for any degree of murder or of rape
* Felony conviction for any other violent crime within the last
five years

Question 44

Whats on the PRESUMPTIVE BAR LIST ?

Answer 44

PRESUMPTIVE BAR LIST
* The list of presumed unacceptable conduct requiring a petition from
the individual is as follows:
* Two or more personal or business bankruptcies
* Revocation or suspension of a non-financial professional
license, unless the revocation is administrative in nature
* Suspension of a financial professional license unless the
suspension is administrative in nature
* Felony conviction for nonviolent crimes, including perjury,
within the last five years
* Felony conviction for violent crimes (other than murder or
rape) that occurred more than five years ago

Question 45

What other adverse conduct is reviewed for CFP candidates ?

Answer 45

OTHER ADVERSE CONDUCT
* Also considered when reviewing candidates for certification:
* Customer complaints
* Arbitrations
* Civil proceedings
* Felony convictions for non-violent crimes that occurred more
than 5 years ago
* Misdemeanor convictions
* Employer investigations and terminations

Question 46

What is the process for Petitions for fitness determination >?

Answer 46

PETITIONS FOR FITNESS DETERMINATION
* A written petition must be submitted
* Transgression must be within the presumptive bar or adverse
conduct list
* The Commission may:
* Grant the petition
* Deny the petition
* Deny the petition and issue a temporary bar, allowing the
individual to reapply after a specified period of time

Question 47

What are the 6 sections of the Standard of Conduct ?

Answer 47

6 sections of the Standard of Conduct :
________________________________________________
DUTIES Owed to Clients
DUTIES Owed TO FIRMS and Subordinates
DUTIES Owed to CFP Board
FINANCIAL PLANNING and Application of the Practice Standards for
the Financial Planning process
PRACTICE STANDARDS for the Financial Planning Process
PROHIBITION on Circumvention

Question 48

Code of Ethics - 6 parts ?

Answer 48

HONESTY integrity, competence, and diligence.
BEST interests. of clients
CARE is exercised
CONFLICTS of interest avoided, disclosed and managed
CONFIDENTIALITY maintained and protect the privacy of client information.
MANNER that reflects positively on the financial planning profession and CFP® certification.

” Honest Buck Cares, Conflict,, Confidentiality & manners “

Question 49

What sections are included in the Certified Financial Planners Board:

“Code of Ethics and Standards” ?

Answer 49

CFP BOARD OF STANDARDS :
________________________________________________________________
CODE OF ETHICS AND STANDARDS OF CONDUCT
* Preamble
* Code of Ethics
* Standards of Conduct
A. Duties owed to clients
B. Financial planning and the application of the practice
standards for the financial planning process
C. Practice standards for the financial planning process
D. Duties owed to firms and subordinates
E. Duties owed to CFP Board
F. Prohibition on circumvention

Question 50

5 Forms of Discipline

Answer 50

FORMS OF SANCTION - discipline
* Private Censure- minor, send letter, not published

• Public Censure - public report
• Suspension - suspended up to 5 years
• Revocation - PERMANENT , NO exception
• Interim Suspension - Accused of something so bad and danger to society, so while under investigation, your are interim Suspended.

Question 51

What are the CE requirements for a CFP ?

Answer 51

30 hours every 2 years ( including 2 hours of Ethics )

Question 52

1. Candidate Fitness Standards
2. What will BAR certification ?
3. What is presumed to be unacceptable and require a petition ?

Answer 52

1. CANDIDATE FITNESS STANDARDS
   3 categories of adverse conduct:

• Unacceptable conduct by candidate
• Presumed to be unacceptable by candidate
• Other conduct that may reflect adversely upon the individual’s
  integrity or fitness, the profession, or the CFP® marks

2. ALWAYS BAR LIST
   Unacceptable conduct that will always bar an individual from
   becoming certified includes:

• Felony conviction for theft, embezzlement or other financially-
  based crimes
• Felony conviction for tax fraud or other tax-related crimes
• Revocation of a financial professional license, unless
  revocation was administrative in nature
• Felony conviction for any degree of murder or of rape
• Felony conviction for any other violent crime within the last
  five year

3. PRESUMPTIVE BAR LIST
   * The list of presumed unacceptable conduct requiring a petition :

• 2 or more personal or business bankruptcies
• Revocation or suspension of a non-financial professional
  license, unless the revocation is administrative in nature
• Suspension of a financial professional license unless the
  suspension is administrative in nature
• Felony conviction for nonviolent crimes, including perjury,
  within the last 5 years
• Felony conviction for violent crimes (other than murder or
  rape) that occurred more than 5 years ago

Question 53

Define Confidentiality and Privacy

Exceptions ?

Answer 53

CFP®
- Keep confidential and may not disclose any non-public personal information about any prospective, current, or former Client.
- may not use any non-public personal information about a client for his or her direct or indirect personal benefit
- Protect the security of non-public personal information about client
- Adopt / implement policies regarding the protection, handling, and sharing of a client’s non-public personal information and must provide a client with written notice of those policies at the time of the Engagement.

Exceptions: _______________________
-CFP® professional may dis-close information
- For ordinary BUSINESS purposes:
- With client’s CONSENT ( not previously withdrawan )
- To CFP® Firm or other persons with whom the CFP® is providing
services to or for the client, when necessary to perform services;
- As necessary to provide information to the attorneys, accountants,
and auditors
- To person acting in a REPRESENTATIVE e capacity on behalf of the
client;
- For LEGAL l and enforcement purposes

Question 54

What can cause Revocation of CFP ?

Whats is the cause the Suspension CFP ?

Answer 54

REVOCATION - PERMANENT ( termination of certification of CFP )
- 2 or more BANKRUPTCIES - personal or business
- PONZI scheme
- Revocation of professional license (e.g., FINRA, insurance,
Accountant, or investment adviser)

SUSPENSION - Period that cannot use CFP tradmarks
- Breach of FIDUCIARY DUTY
- COMMINGLING
- FORGERY
- CONVICTION w/in last 10 years of Felony or Misdemeanor (see Code and Standards Section E.1.b) involving a jail sentence, suitability violations, professional discipline involving a suspension of more than 30 days

Question 55

Which Disclosures for Financial Advice and Financial Planning
are given in “writing” and which “ oral” ?

Answer 55

——————————-Financial Advice Financial Planning

______________________________________________________________________
Privacy Policy WRITE WRITE
Conflicts of interest oral/write oral /write
Services /products WRITE
How client pays WRITE
how ALL paid WRITE
Public disclosure WRITE
Referral Compensation WRITE
Other Material Info WRITE

Question 56

Which of the following is/are true regarding revocation?

1. Revocation is permanent unless due to a felony conviction that is subsequently overturned.
2. A CFP® certificant may petition CFP Board for reinstatement after revocation if the certificant proves that he or she has been rehabilitated by clear and convincing evidence.
3. Suspension is not always permanent.I and II
   III only
   II and III
   I only

Answer 56

Solution: The correct answer is D.

May petition the Board if the marks are suspended for more than one year. If a felony conviction is overturned, the certificant may petition for reinstatement, but it is not guaranteed. Suspension is never permanent, it either ends in revocation or re-instatement of CFP® Mark use.

Question 57

Which of the following is/are forms of discipline?

1. Private Censure
2. Revocation
3. Suspension
4. Public Letter of Admonition

A. I and II
B. I, II and III
C. II, III and IV
D. I, II, III, and IV

Answer 57

Solution: The correct answer is D.

Question 58

Paul recently applied for CFP® Certification. Which of the following would always bar him from certification?

A. One or more personal bankruptcies.
B. Felony conviction for perjury last year.
C. Felony conviction for aggravated assault.
D. Felony conviction of embezzlement.

Answer 58

D. Felony conviction of embezzlement.

Felony conviction of a financially based crime, like embezzlement, will always bar.