“Honesty is the best policy.”
-Sir Edwin Sandys, 1599
CFP Board reported automatic interim suspensions on several participants’ right to use the CFP® mark in its April 14, 2020, press release. The CFP Board suspensions were based upon investment license revocations by the State of California and FINRA. Assuming the allegations made by CFP Board are proven, a number of recently-disciplined CFP® certificants may have done well by more closely following Sir Edwin’s 421-year-old proverb. Two instances of automatic interim suspension follows:
Revocation of a State Financial License – Case 1
According to CFP Board, a CFP® certificant was barred from “any position of employment, management or control of any investment adviser, broker-dealer or commodity advisor in the State of California” by the California Commissioner of Business Oversight. The Commisioner also revoked the certificant’s state-issued investment advisor certificate and noted these specific violations:
- “Accessing client accounts using the clients’ personal usernames and passwords without their authorization;
- mismanaging clients’ accounts and recommending unsuitable investments to senior clients in breach of his fiduciary duties and resulting in large losses; and
- engaging in unlawful market manipulation by trading penny stocks in clients’ accounts.”
According to CFP Board, the certificant’s “right to use the CFP® certification marks is suspended pending CFP Board’s completed investigation and possible further disciplinary proceedings.”
Revocation of a Federal Financial License – Case 2
This case provides a stark example of how a “Nolo Contendre” or “No contest” plea can result in suspension of a participant’s right to use the mark. According to CFP Board, the certificant entered into a “Waiver and Consent” agreement with FINRA in which he admitted no wrongdoing but accepted FINRA’s findings that “…barred him from associating with any FINRA member in any capacity after he failed to produce information or documents to FINRA in response to its written requests.” FINRA “sought information and documents regarding [the certificant’s] alleged fraudulent facilitation of distributions from the accounts of clients without their knowledge or consent or for their benefit.”
CFP Board responded by imposing “an automatic interim suspension” of the certificant’s right to use the CFP® certification marks.
After CFP Board’s Investigations
Revocation of a certificant’s financial license may result in discipline as serious as a permanent bar from using the CFP® mark.
No professional certification is immune from a member’s alledged violation of ethical standards. However, when allegations of wrongdoing are raised, we can take heart in CFP Board’s efforts to maintain public confidence in the integrity of the CFP® mark.