Representing financial professionals, financial institutions and investors in investment loss, employment and disclosure matters, and in regulatory investigations nationwide.

CFP Board requests comment on revised sanction guidelines and fitness standards

On Behalf of | Sep 12, 2023 | CFP Board

The Certified Financial Planner Board of Standards is requesting public comment on proposed revisions to its sanction guidelines and fitness standards, Financial Planning reports.

The proposals follow a comprehensive review by the Commission on Sanctions and Fitness, established by the CFP Board in February 2021.  The CFP Board of Directors then reviewed the Commission’s recommendations, which were developed over a period of nearly two years.

The Board said its proposed revisions focus on modifying the current sanction guidelines to benefit the public and CFP® professionals who uphold the high standards of certification.  It added that the recommended sanctions should reflect current perspectives that may differ from the last version, created 11 years ago.

“We strongly encourage CFP® professionals, and members of the public more broadly, to submit their input on these proposed revisions,” said CFP Board CEO Kevin R. Keller, CAE. “We believe the proposed revisions to the Sanction Guidelines and Fitness Standards benefit public trust when working with a CFP® professional, advance the profession for those who uphold the standards and promote confidence in the ethical and competence standards of CFP® certification. Public comment periods offer an opportunity for you to give us feedback, and we welcome your perspective.”

The proposals include a revised inventory of 52 areas of potential misconduct by certified financial planners, including breach of fiduciary duty, forgery and lack of diligence, and the sanctions that would result from those violations. Those who commit perjury, obstruct justice, tamper with a witness, or engage in identity theft would receive a permanent ban from the industry.

The Board also proposed a new list of 25 general aggravating and mitigating factors that describe the factor and state when the factor should or should not weigh in favor of raising the sanction or lowering the sanction.

Another proposal is a revised framework for evaluating fitness that identifies when an applicant (a) is permanently barred from seeking CFP® certification, (b) currently is ineligible from seeking CFP® certification and (c) is required to file a Petition for Fitness so that the Disciplinary and Ethics Commission may determine whether the applicant is fit for CFP® certification

The deadline for the public to submit comments on the proposals is December 3, 2023. The Board of Directors will consider the public comments and proposed changes during its March 2024 meeting.

Lewitas Hyman PC represents advisors, brokers and other financial professional in all matters involving the CFP Board, including CFP Board investigations. Headquartered in Chicago, our securities attorneys represent clients nationwide. For more information relating to CFP Board investigations and discipline or other matters, contact Lewitas Hyman at (888) 655-6002 or through our online contact form for a free consultation