CFP Board Crackdown Prompts Disciplinary Measures For Another 26 Planners

Wednesday, June 22, 2011 06:29
CFP Board Crackdown Prompts Disciplinary Measures For Another 26 Planners

Tags: CFP Board | financial planning

Four months after the last wave of CFP Board disciplinary actions, another 26 planners are getting stern letters or losing their right -- temporary or permanent -- to use the CFP mark.

This Website Is For Financial Professionals Only


The latest round of chastisement follows on February's then-unprecedented wave of 27 disciplinary actions.


As then, the worst infractions are pretty bad: fraud, embezzling.


But eight of those being disciplined simply filed for bankruptcy. This is in line with the CFP Board's "those who can't do, shouldn't teach" code of money management, but there's a curious moral equivalence here.


Is the punishment for going broke in the planning world really the same as the punishment for "24 felony counts of securing execution of a document by deception, 23 felony counts of misapplication of fiduciary property, and 12 felony counts of forgery?"


It is. The CFP Board is slapping as hard as it can here, but the really bad cases are just so rare that the crime goes off the scale of applicable punishment.


Meanwhile, if you commit that much securities fraud, you probably lose your career and your freedom as well as your CFP mark. Being stripped of your mark is literally adding insult to injury at that point.



Comments (2)

Nobody but you says the two penalties imposed somehow imply a moral equivalence between the infractions. Yes, CFPs filing personal bankruptcy lose their credentials--some permanently, and so do CFPs that commit securities fraud.
But securities fraud is a far more serious issue because you're not only screwing yourself but others, too.
For the CFP Board to be taken seriously, it needs to mete out real sanctions for unethical behavior.
Mistakes in judgment where an advisor ends up in personal bankruptcy can occur due to divorce, a single bad business decision, and bad timing. It's fair that the CFP Board takes strong action that forever lists a personal bankruptcy on a CFP's professional record.
I wonder if the CFP Board's action becomes part of a Google search result. In other words, when a CFP gets his license suspended for declaring personal bankruptcy, does that CFP Board action come up high in the results when I search the name of the CFP on Google? Would be neat to check this out.

agluck , June 22, 2011
I just did a quick test of google search for names of a few advisors recently censured by the CFP Board. I searched at random about 6 or 7 names from this list and found no cases where the CFP Board's web page got picked up high in the results.

However, in every instance, another high-ranking site picked up the news of the censures and that article ranked on the first page, often within the first five results. In these particular cases, most of the names were repeated in a fa-mag article and that got indexed at the top of the google results.

It must be hard for these advisors to get new business when they have an article about disciplinary actions against them as one of the top search results for their names.
bshanahan , June 23, 2011

Write comment

You must be logged in to post a comment. Please register if you do not have an account yet.