Jeffrey and Kimberly Camarda are not accepting defeat in their battle against the Certified Financial Planner Board of Standards Inc. over the use of the term "fee-only."
They filed an appeal Wednesday of a federal court decision that threw out their lawsuit against the board for threatening to sanction them for using the term fee-only to describe their compensation method. The Fleming Island, Fla., planners charge fees for their planning services, but also own an insurance company that charges commissions, which the board says disqualifies them from describing themselves as fee-only on the CFP Board website.
A U.S. District Court judge ruled in July that the board is a private entity and can enforce its own rules as it sees fit.
“After very deep consideration, Kim and I have determined to appeal the court’s decision to dismiss our case against the CFP Board, and request a public trial on the merits of our case. We believe there to be substantial legal merit for our appeal to be successful, and that we will ultimately prevail at the ensuing trial,” Camarda said in a statement issued Thursday.
“We believe there are grave wrongs to be righted here, with the welfare of the profession and of the client public, hanging in the balance,” he continued.
“We believe it has been quite misleading for CFP Board to contend its process is ‘fair,’ when it, for the same alleged ‘offense,’ has offered resolutions ranging from blanket amnesty and private deals, to the admonition and forced resignation of its own chairman -- a chairman who had a hand in writing the very rules he was accused of violating, and claims they were incredibly distorted in order to prosecute him because it served political ends,” Camarda said.
The controversy does not involve just the Camardas. Former CFP Board Chairman Alan Goldfarb resigned after the board sanctioned him for using the term fee-only because he owned 1 percent of his firm’s broker-dealer, which accepts commissions. The board also gave thousands of wirehouse advisors a chance to change their compensation designation without penalty.
The CFP Board feels it will be vindicated in the appeals process.
“CFP Board stands behind [federal court] Judge [Richard] Leon’s determination that CFP Board complied with the law when it imposed a sanction based upon a finding by other CFP professionals and members of the public that the Camardas violated CFP Board’s rules,” the board said in a statement.
“We believe that the judge’s decision will stand and that an appeals court will agree with Judge Leon that CFP Board ‘followed its own rules throughout the disciplinary proceedings’ and that there is ‘no evidence that [CFP Board] was motivated by bad faith or ill will’ in disciplining the Camardas,” the board said.