The Certified Financial Planner Board of Standards announced on Friday disciplinary actions against 10 current and former advisors accused of violating its standards of conduct.
The Washington, D.C.-based professional organization responsible for the CFP certification mark uses three levels of public disciplinary action. On Friday, the board announced the actions, in order of severity: six letters of admonition, two suspensions and two revocations.
Aaron R. Parthemer of Ft. Lauderdale, Fla., had his right to use the CFP marks permanently revoked as of January 4, 2016. The CFP Board’s Disciplinary and Ethics Commission said he loaned $400,000 to three clients, then presented a private securities transaction to his clients, eight of whom invested in the offering, without disclosing the transaction to the firm.
Parthemer also allegedly participated in at least three outside business activities without providing prior notification or seeking approval from his firm while falsely representing to his employer in a compliance questionnaire that he was not conducting any outside business activity or private securities transactions.
In addition, the CFP Board alleges that Parthemer provided false information and documents to Finra, which resulted in his being barred from association with any Finra member. Parthemer allegedly failed to disclose Finra’s investigation on multiple CFP renewal applications.
Allen L. Mitchell of Decatur, Ga., has received a permanent administrative revocation of his CFP marks, effective July 2, 2015, after he failed to answer a complaint within the required time period. The complaint alleged that Mitchell filed for Chapter 7 bankruptcy in 1996 and again in 2013.
Those suspended included D. Robin Walker of Verona, Mo., and James P. O’Mara of York, Pa.
Walker received a one-year suspension in 2015. The Disciplinary and Ethics Commission found that after Walker’s firm had forbidden him to use a proprietary ETF trading model he had developed with its institutional clients, he formed an RIA against his firm’s demands to use the model, using nominee owners.
The board found that Walker breached his fiduciary duty when he failed to disclose to clients the extent to which he could manage the RIA or his potential conflicts when advising clients to invest with the RIA—or that he and his partners were seeking approval from their firm to obtain ownership interests in the RIA that would entitle them to share in profits derived from his clients’ payment of advisory fees.
In addition to the suspension, the SEC ordered Walker to pay $60,000 in civil penalties, while Finra fined him $20,000 and suspended him for 18 months.
O’Mara received a 90-day suspension in October 2015, when the CFP Board found he had held himself out to the public as a certified public accountant when he was not licensed as one, that he had failed to document a bankruptcy filing in a timely manner, that he failed to report his bankruptcy to his employer and that he had failed to report his bankruptcy and an investigation by the Pennsylvania Board of Accountancy to the CFP Board on multiple renewal applications.
Letters of admonition went to:
- Harold S. Kern of San Jose, Calif., stemming from his filing for Chapter 13 bankruptcy in 1995 and 2015;
- Sean E. Mattson of South Lyon, Mich., after he allegedly failed to report to the CFP Board his termination with cause and his suspension by Finra;
- Deborah S. Giffin of McMurray, Pa., for allegedly failing to disclose most of her outside insurance and commission-based business activities to her firm;
- Gary L. Barker of Salt Lake City, Utah, for allegedly placing an elderly client into an illiquid, high-risk investment and for failing to register a branch office as an office conducting securities business;
- Roxanne K. Villarreal of Reston, Va., for failing to disclose to the CFP Board three alcohol-related misdemeanor offenses;
- Kevin R. Bonner of Burien, Wash., for allegedly taking a loan from a client, then failing to repay the loan as the debt was discharged in a 2014 Chapter 7 bankruptcy.
The CFP enforcement process ensures that certification holders adhere to the CFP Board’s standards of professional conduct, which include the code of ethics and professional responsibility, the rules of conduct and the financial planning, practice standards.
Enforcement actions follow a procedural investigation of alleged unethical behavior. When violations are discovered, the CFP Board’s Disciplinary and Ethics Commission may impose penalties ranging from a private censure to public disciplinary action, up to revocation of the right to use the CFP marks.