CFP Notes: Professional Conduct and Regulation - Disciplinary Rules and Procedures

Board of Professional Review
The Board of Professional Review is charged with investigating, evaluating, and taking whatever action is appropriate when violations of the Code of Ethics are alleged to have occurred. The Board of Professional Review is also called in when there is an allegation that a financial planner has not complied with the Practice Standards. The Board can be divided into two panels: an Inquiry Panel (which investigates and assesses allegations) and a Hearing Panel (which administrates hearings regarding violations). Each panel will have a chair. No member of one panel is allowed to serve on the other panel in regards to the same matter.

Staff Counsel and Grounds for Discipline
The staff counsel maintains a central office for the filing of requests for the investigation of CFP Board designee conduct, for the coordination of investigations, for the enforcement of disciplinary enforcement proceedings carried out pursuant to these procedures, for the prosecution of charges of wrongdoing against CFP designees, and for any other duties designated by the Board. Individuals may be subject to discipline any time they commit an act that violates the Code of Ethics and Professional Responsibility.

Individuals may be subject to discipline for acts that do not comply with the Practice Standards, acts that violate the criminal laws of any state or of the United States, acts that are the proper basis for professional suspension, a failure to respond to a Board request, or presenting any false or misleading statement to the CFP Board.

Forms of Discipline and Investigation
If the CFP Board determines that there are no grounds for disciplinary action, then they will take no action. The Board has the right to force a designee to complete additional education or remedial work. The Board may privately censure a designee. The Board may also issue a public Letter of Admonition, which is a reproach against misbehavior. The Board may order that a designee be suspended for a certain length of time. The Board may also permanently revoke the license of a designee. When allegations are made and an investigation is begun, the designee has 20 calendar days from the notice of the investigation to file a written response with the Board. If there is no response, the Hearing Panel takes up the matter; otherwise, the Inquiry Panel takes up the matter.