CFP Board Looks to Revise Sanction Guidelines

The Certified Financial Planner Board of Standards, Inc. (CFP Board) announced earlier this month that it has formed a new 15-member Commission to review its process for sanctioning CFP mark holders who do not live up to its standards. This new Commission will review and recommend changes to the CFP Board’s Sanction Guidelines and Fitness Standards for Candidates for CFP® Certification and Former Professionals Seeking Reinstatement (“Fitness Standards”).

These important documents address the consequences of failing to comply with the CFP Board’s Code of Ethics and Standards of Conduct. The Fitness Standards apply to those seeking CFP® certification, while the Sanction Guidelines apply to those who are certified.

The board reviews conduct and business practices of mark holders. If the board determines it is warranted, a CFP designee can be barred from using the mark for various periods of time, including lifetime, or can be issued a letter of sanction. The actions are reported on the CFP website.

The Code of Ethics and Standards of Conduct were recently revised, with new rules going into effect on June 30, 2020. This means that CFP’s are now obligated to act as a fiduciary and in the best interest of his or her client at all times when providing financial planning or advice.

The group is comprised of distinguished individuals, including members of the public, consumer advocates, individuals with regulatory experience, and CFP® professionals representing various business and compensation models. The CFP Board will issue the Board’s proposed revisions to the Sanction Guidelines and Fitness Standards for one or more rounds of public comment before final revisions are adopted.

To begin the Commission’s work of gathering input from the public and financial planning profession, CFP Board is hosting two virtual forums on Thursday, February 18, 2021, at 8:30 a.m. and 5:00 p.m. (Eastern). You can register by visiting the CFP Board’s website, located here.

The 15-member commission will be discharged after the Board of Directors issues the final revised Sanctions Guidelines and Fitness Standards.

To learn more about Quest CE’s course, “Ethics CE: CFP Board’s Revised Code of Standards,” which was written to comply with the CFP Board’s new Code and Standards, click here.