Last updated: 10:57 / Wednesday, 17 July 2019
In line with Reg BI

CFP Professionals Have Another Nine Months to Comply with New Code of Ethics and Standards of Conduct

CFP Professionals Have Another Nine Months to Comply with New Code of Ethics and Standards of Conduct

The Board of Directors of the Certified Financial Planner Board of Standards announced on Tuesday that it has set a date of June 30, 2020 when CFP professionals’ compliance with the new Code of Ethics and Standards of Conduct will be enforced.

The previously announced effective date of October 1, 2019 remains the same for the over 85,000 CFP professionals to understand and comply with the new rules. In setting a targeted enforcement date, the Board of Directors is providing CFP professionals additional time before compliance is enforced with the new Code and Standards.

“In order to best benefit the public, the Board wants CFP professionals to have time to adjust to the new Code and Standards. By setting this enforcement date, we are ensuring they have ample time to modify their policies, adapt systems and be in alignment with the new rules,” said Board Chair Susan John, CFP. “With these new standards, CFP professionals will be required to provide clients with fiduciary financial advice at all times.”

John specifically noted that none of the Code and Standards themselves had changed. This includes, what she called, the “iron clad” commitment of CFP Board to require CFP professionals – no matter their compensation method – to adhere to a fiduciary duty whenever delivering financial advice.

“Since the beginning of the nearly four-year process to review our standards, we said that CFP Board would not be led by what actions regulators take. But we won’t ignore them either,” John said.

“The Board, however, does believe that the alignment of the SEC’s enforcement date of Regulation Best Interest (Reg BI) is helpful to our CFP professionals in that there is significant overlap in the two sets of standards – with a notable exception that CFP professionals are required to act as a fiduciary whenever they are providing financial advice to clients.”

For conduct that occurs between October 1, 2019 and June 29, 2020, CFP Board will continue to enforce violations of the existing Standards of Professional Conduct. Starting June 30, 2020 and onward, CFP professionals will then be subject to potential disciplinary action for any violations of the new Code and Standards. Additionally, the exam starting with November 2019 exam will include material from the new Code and Standards.

“We appreciate the valuable input of CFP professionals, their firms, trade associations and membership organizations representing CFP® professionals in helping the Board come to this decision,” John said. “It is now time for all of us to pull together and comply with the new standards so that we can provide the public with the highest level of financial advice.”

A guide to the new standards can be found here.