The CFP Board is giving no sign of backing down on several controversial issues, despite a barrage of hostile fire from the advisors it regulates.
           
The latest issue is the board’s ongoing talk about setting up a continuing-education program.

The CE issue heated up at the FPA’s annual meeting in October, where FPA leaders blasted the idea.
                    
Planners have been concerned about conflicts with the board operating a CE program at the same time it approves competing programs for CFP credits. 

The FPA, of course, would be one of the competing providers.
           
“It’s a clear conflict of interest, and potentially a very distracting business line for the board,” said Dan Moisand of Moisand, Fitzgerald and Tamayo LLC, who is heading a continuing-education, best-practices task force for the FPA, with the stated goal of improving CE programs industry wide.

The board has “bigger fish to fry, like the fiduciary issue at the SEC and DOL, and how to regulate advisors,” Moisand said. “They need to be focused on that.”

“Why does the CFP Board, which has been taking a stand against conflicts of interest, want to embrace its own huge conflict” by starting a CE program? asked Bob Veres, publisher of Inside Information, who also runs a conference offering CE credits.
           
But the CFP Board does not seem to be swayed by such criticism.

In a written response, the board said it was “very well aware” of the FPA’s concerns, and that it was “still evaluating and discussing all options …  to improve the quality of CE.”
           
Likewise, the CFP board shows no sign of backing down on its controversial compensation definitions, which have created new regulatory risk for CFPs who misidentify how they’re paid.

Those rules forbid CFP holders from calling themselves “fee only” if they’re affiliated with a broker-dealer or insurance agency that receive commissions. (It doesn’t matter if the client only pays -- and the planner only gets -- fee compensation.)
           
In an update to CFP holders in mid-October, board chief executive Kevin Keller seemed as adamant as ever about not yielding on the pay flap: “Our definition of ‘fee-only’ is a clear, common sense and plain-English explanation,” he said.

The CFP Board has yet to specifically address the flipside of this problem with “commission-only” planners. Most brokerage firms, for example, earn fee revenue so under board rules commission-only CFPs at these B-Ds should be describing themselves as “fee and commission.”
           
One could even go so far as to argue that since pure RIAs are “affiliated” with a B-D custodian, they should be tagged “fee-and-commission” as well.
           
Legal guru Brian Hamburger doesn’t quite buy that logic. “I think if you're fee-only, the client should have the opportunity to engage you independently of any brokerage firm,” said Hamburger, founder of MarketCounsel LLC.

Clients of RIAs could custody at a number of B-Ds and still engage the advisor for a fee, he said, but to hire a fee-based Merrill Lynch advisor, a client has to hire Merrill, which directly or indirectly compensates brokers from a variety of revenue sources, Hamburger said. That’s why he agrees that CFPs at brokerage firms should be termed “fee-and-commission.”
           
Meanwhile, the CFP Board isn’t backing down from its fight with Florida planners Jeff and Kim Camarda over the “fee only” enforcement case that precipitated the entire controversy, and led to the forced resignations of former board chairman Alan Goldfarb and two members of the organization’s disciplinary committee.

The Camardas are seeking an injunction to block the case. “Although we believe we gave the [CFP] Board every reasonable opportunity to resolve this dispute … it has refused to do so,” the Camardas said in a statement.
           
The Florida planners are attempting to add additional claims to their legal action against the CFP Board, including antitrust violations.
           
“These proposed new claims… appear to be a last-minute strategy to create negotiating leverage and increase the costs of defense,” the board countered in an October 15 court filing.
           
Don’t look for the CFP Board to recalibrate its controversial stances anytime soon. Even when the board has taken a wrong turn, Veres said, “institutionally, as an organization, [the CFP Board] has had a hard time backtracking.”