Financial advisors who are CFP mark holders have been asked to weigh in on changes the Certified Financial Planner Board of Standards has proposed for some of its regulations.
The changes that have been proposed by the board are intended to update the board’s enforcement processes and enable the board to better enforce its Code of Ethics and Standards of Conduct, the board said when it announced the public comment period today.
The board regularly updates its procedural rules. The last revision was made last year, when the procedural rules and sanction guidelines were changed to create an appeals commission to hear cases of disciplinary actions imposed on CFP mark holders. This change became effective in February.
The procedural rules outline the processes used for investigating alleged misconduct of advisors and for enforcing the CFP Board’s Code of Ethics and Standards of Conduct. The goal is to make the investigations and conclusions fair to those who are being investigated, as well as being credible to the public, the board said.
The proposed revisions address topics raised by CFP professionals. As outlined by the board, the changes include the following:
• Expanding the role of counsel for the disciplinary and ethics commission to make the adjudication process more efficient.
• Transferring some administrative functions from enforcement to adjudication.
• Incorporating an existing disciplinary and ethics coming standing order and other existing practices.
• Promoting the benefits of the adversarial process by eliminating settlement counteroffers.
• Requiring respondents who are the subject of an interim suspension order to file a petition for reinstatement within two years or receive an administrative order of revocation.
• Enabling pre-investigation outreach.
• Establishing a process for admitting expert witness testimony.
• Modifying the limitations period to address situations where enforcement counsel does not know if the limitations period has passed when opening an investigation.
When an advisor has violated the board’s code of ethics or standards of conduct, the board can permanently revoke the advisor’s right to use the CFP mark, temporarily bar the advisor from using the mark, or issue a public letter of admonition.
The CFP Board staff and the Board of Directors’ Code and Standards Enforcement Committee will review the comments on the proposed changes and make a recommendation to the full board of directors. The board said it then will decide whether to adopt the changes at an upcoming meeting.
“We encourage and welcome candid feedback from CFP professionals and other stakeholders on these proposed changes,” Kevin R. Keller, CFP Board CEO, said in a statement. “The CFP Board is continually evaluating our investigation and enforcement operations to ensure that our process benefits the public and is fair to the certificant.”
Comments can be submitted on the CFP.net website. The comments, which are due by Jan 23, will be published.