CFP Board Extends Compliance Date for New Ethics Standards
Aligning the enforcement date with that of the SEC’s Regulation Best Interest is "helpful" to CFP professionals given the "significant overlap in the two sets of standards," said CFP Board Chair Susan John.
The Certified Financial Planner Board of Standards’ Board has extended the compliance date for its new Code of Ethics and Standards of Conduct to June 30, 2020, to coincide with the compliance date of the Securities and Exchange Commission’s Regulation Best Interest.
The CFP Board’s fiduciary ethics standards, however, will still become effective on Oct. 1, 2019.
“In order to best benefit the public, the Board wants CFP professionals to have time to adjust to the new Code and Standards,” said Board Chair Susan John on Monday.
“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. With these new standards, CFP professionals will be required to provide clients with fiduciary financial advice at all times,” John explained.
She noted that that none of the Code and Standards themselves had changed.
“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,” she added.
For conduct that occurs between Oct. 1, 2019, and June 29, 2020, the CFP Board will continue to enforce violations of the existing Standards of Professional Conduct.
Starting June 30, 2020, CFPs will be subject to potential disciplinary action for any violations of the new Code and Standards. The board will continue to educate CFPs on the new standards and hold meetings with small and large firms.
Educational materials for the ethics CE requirement are focused on the new standards, and as of November, exams will include material from the new standards.