The Certified Financial Planner Board of Standards has proposed removing some infractions for which advisors have been disciplined from its website after a period of time, the board announced Tuesday.
The move is part of an overhaul of the procedures surrounding disciplinary action that the CFP Board hands out when advisors break the law or do not live up to the CFP Board standards.These actons are currently posted on the CFP Board website.
Under the proposed change, the notice would be removed in either five or 10 years for advisors who receive a letter of admonition or are suspended from using the CFP mark for one year or less and have not gotten into any other trouble. The board can issue letters of admonition, suspend an advisors’ right to use the CFP mark for any length of time, or permanently bar advisors’ right to use the mark, depending on the severity of the infraction.
A public comment period is open until Jan. 29 for professionals or the public to weigh in on the proposals.Comments can be emailed to the board at [email protected] or a form can be filled out on the webiste.
Some other key changes involve clarifying who may review confidential information, establishing an expedited process for complaints involving bankruptcies, placing a time limit on when the CFP Board staff can issue a notice of investigation to an advisor and placing a time limit on the amount of time for issuing a complaint against an advisor after an investigation starts. The full set of changes can be found on the CFP Board website.
The CFP Board also developed a new set of responses to “Frequently Asked Questions” about the Code of Ethics and Standards of Conduct that will go into effect on Oct. 1 next year. The new standards were adopted in March. The board subsequently created a Standards Resource Commission to provide guidance to CFP professionals and their firms on the new code and standards. The commission has developed answers to the FAQ’s based on responses from stakeholders.
The FAQs and answers address such topics as the requirements of CFP Board’s new fiduciary duty, changes to the financial planning process, the requirement to provide full disclosure of all material conflicts of Interest, and the duty not to make false or misleading representations of compensation method, including when a CFP professional cay use the term “fee-only” and what a CFP professional must do when using the term “fee-based.”
Additional information on the disciplinary procedure changes and the frequently asked questions is available on the CFP Board website.