As the CFP Board closes its comment period today on its complete overhaul of its proposed Code of Standards, the board finds itself at the center of one of the most contentious issues facing the industry—advancing a comprehensive fiduciary standard for its 80,000 certificate holders for the first time in a decade.

Not surprisingly the proposal, which is expected to be approved by the second quarter and go into effect in January 2019, is eliciting strong reaction from opposing sides of the industry. (A side-by-side comparison of the new and existing CFP Board Codes of Standard is available here.)

Last week, the CFP Board declined an aggressive industry request to delay its proposed standards so that regulators could formulate their own rules.

Now the certification group will begin reviewing the more than 120 comment letters it’s expecting to flood in on the proposal, including some of the more critical missives from the Consumer Federation of America, the Institute for the Fiduciary Standard and NAPFA (the National Association of Personal Financial Advisors).

These groups allege that the proposed CFP standards don’t go far enough to require CFPs to avoid certain conflicts of interest, especially in the compensation area. They are also asking the board to require written disclosure of all conflicts (not just material conflicts) and require CFPs to obtain clients’ informed consent for conflicts.

The CFA is asking the CFP Board to ban certain compensation practices, including sales quotas for proprietary products; differential compensation; compensation based on retroactive, ratcheted payout grids; and up-front signing bonuses.

These compensation conflicts “can reasonably be expected to cause advisors to base recommendations on their own financial interests rather than the best interests of the customer,” the CFA said.

CFP Board General Counsel Leo Rydzewski said that the board formulated proposed standards that it believes are the best path forward, but will review and consider all comments. “The comment period ends today. We look forward to reviewing the comments as we move forward in the process of developing a new Code of Ethics and Standards of Conduct for CFP professionals.”

“Why not urge avoidance over disclosure?” asked Knut Rostad, president and founder of the Institute for the Fiduciary Standard, in a comment letter. “The board discussion of conflicts of interest is noteworthy. Most of all for what the board declines to do,” Rostad added.

In a marked-up version of the proposed standards obtained by Financial Advisor, the CFP Board said: “Some commenters would require CFPs to avoid conflicts whenever possible.” But it added that all conflicts cannot be avoided. For instance, “there is a conflict when a client pays a CFP for providing services regardless of the compensation method” the CFP Board said.

The group also said that when considering complaints against a CFP practitioner, “ambiguity in the disclosure provided to the client will be interpreted in favor of the client.”

“The greater the potential harm the conflict presents to the client, and the more significantly a business practice that gives rise to the conflict departs from commonly accepted practices among CFP professionals, the less likely it is that CFP Board will infer informed consent absent clear evidence otherwise,” the proposed disclosure states.

Last week, the CFP Board soundly rejected a request from the Financial Services Institute and SIFMA to delay its rule-making until the U.S. Department of Labor and the Securities and Exchange Commission promulgated their rules. The DOL has extended its review of its fiduciary rules, including its conflict of interest disclosure, until July 2019. The SEC has yet to propose any fiduciary or “best interest” standards, although the agency has said it is a priority to do so by the second quarter of 2019.

Kevin Carroll, SIFMA’s managing director and associate general counsel, said in a statement, “The SEC is currently working on a best interest standard that would apply to all financial advisors—not just CFP certificants, expected later this year. It would be counterproductive for the CFP Board to front-run the SEC’s efforts. The CFP Board should pause and allow the SEC to take the lead.”

The CFP Board is expected to finalize changes to the proposal in the second quarter of 2018 and make the new code effective January 1, 2019.