CFP Board Adopts Revised Sanction Guidelines, Fitness Standards and Procedural Rules

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Mar 13, 2024, 10:00 ET

WASHINGTON, March 13, 2024 /PRNewswire/ -- CFP Board today announced that its Board of Directors has adopted revised Sanction Guidelines and revised Fitness Standards for Candidates for CFP® Certification and Former CFP® Professionals Seeking Reinstatement ("Fitness Standards"). Both will take effect on July 1, 2024. The revised Sanction Guidelines applies to misconduct occurring after July 1, 2024, and the revised Fitness Standards applies to a candidate for CFP® certification who submits an application on or after July 1, 2024.

The Board of Directors has also adopted revised Procedural Rules incorporating several technical changes, including changes that reflect the revisions to the Fitness Standards and Sanction Guidelines. The revised Procedural Rules will take effect on July 1, 2024, and shall govern in all proceedings then pending or thereafter commenced.

"These updates to CFP Board's Sanction Guidelines, Fitness Standards and Procedural Rules demonstrate our commitment to maintaining high standards of conduct for CFP® professionals and preserving the trust of the clients they serve," said CFP Board CEO Kevin R. Keller, CAE. "These revisions will further the standard for financial planners to advance the profession and serve the best interest of the public while maintaining fairness for CFP® professionals."

CFP Board's Sanction Guidelines provides transparency and promotes consistent imposition of sanctions for similar offenses, considering the unique facts of each case. Sanctions are intended to be meaningful and calibrated to the seriousness of the misconduct. The Fitness Standards provides the standards against which CFP Board evaluates the ethical fitness of a candidate working toward CFP® certification and a former CFP® professional seeking reinstatement.

The revised Sanction Guidelines and Fitness Standards were developed through a deliberative, multi-year process led by CFP Board's Commission on Sanctions and Fitness. They are intended to benefit the public, advance the financial planning profession, hold a Respondent accountable for misconduct, educate about conduct that will result in a violation, deter Respondents from committing similar violations in the future and promote public confidence in CFP® certification.

CFP Board's Board of Directors adopted the revised Sanction Guidelines and Fitness Standards after carefully considering the comments received in response to CFP Board's request for public comments, including feedback received during a webinar and at in-person meetings in five cities. They also adopted revisions to CFP Board's Procedural Rules that reflect the revisions to the Fitness Standards and Sanction Guidelines, among other changes.

The final revised Sanction Guidelines and Fitness Standards reflect several changes to the draft versions that were released for public comment. Comments received are available for review, as well as a summary of responses to select comments that includes redlined versions showing revisions made following the public comment period.

Summary of Key Changes in the Revised Sanction Guidelines and Fitness Standards

The revised Sanction Guidelines and Fitness Standards implement a variety of significant changes from the current Sanction Guidelines and Fitness Standards, including the following:

A revised inventory of 52 conduct categories that align with the Code and Standards
A new list of 25 general aggravating and mitigating factors that describe the factor and state when the factor should or (should not) aggravate (weigh in favor of raising the sanction) or mitigate (weigh in favor of lowering the sanction)
An expanded list of specific aggravating and mitigating factors that are tied to specific conduct categories
A revised framework for evaluating fitness that identifies when an applicant (a) is permanently barred from seeking CFP® certification, (b) is currently 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
An expansive description of the conduct that will result in (a) a permanent bar, (b) a determination that the applicant currently is ineligible for CFP® certification and (c) a required Petition for Fitness
A uniform application of the Sanction Guidelines to both applicants and CFP® professionals so that there is parity in CFP Board's evaluation of applicants and CFP® professionals, as well as similar consequences of misconduct for applicants and CFP® professionals
A new Public Notice that will result if CFP Board grants CFP® certification but the applicant has engaged in conduct that would have resulted in a public censure if the applicant were a CFP® professional
Several policy conclusions, including the following:

Certain misconduct should always bar an applicant from becoming a CFP® professional.
CFP Board should continue to allow the Disciplinary and Ethics Commission (DEC) to issue private sanctions.
The DEC should not be granted authority to impose monetary sanctions.
CFP Board should at no time remove public sanctions from CFP Board's website.

Revised and Redlined Documents

The following links allow access to the revised documents and redlined versions showing the changes from the previous versions of the documents:

ABOUT CFP BOARD
CFP Board is the professional body for personal financial planners in the U.S. CFP Board consists of two affiliated organizations focused on advancing the financial planning profession for the public's benefit. CFP Board of Standards sets and upholds standards for financial planning and administers the prestigious CERTIFIED FINANCIAL PLANNER™ certification — widely recognized by the public, advisors and firms as the standard for financial planners — so that the public has access to the benefits of competent and ethical financial planning. CFP® certification is held by nearly 100,000 people in the U.S. CFP Board Center for Financial Planning addresses diversity and workforce development challenges and conducts and publishes research that adds to the financial planning profession's body of knowledge.

SOURCE CFP Board