Kitces, Others React to Unprecedented CFP Board Action Against Rude Advisor

What You Need to Know

An advisor's CFP certification was revoked by the CFP Board for insulting a prospective client by email and being disrespectful towards a CFP Board counsel.
The advisor told a prospective client by email that he understood why her husband left her.
Advisors and other CFPs were stunned by his actions but not all agreed his credential should have been revoked.

Several advisors and certified financial planners have spoken out on Twitter and criticized the behavior of an advisor based in Sequim, Washington, whose CFP certification was recently revoked by the Certified Financial Planner Board of Standards for insulting a prospective client by email and for being unprofessional and disrespectful towards a CFP Board counsel, among other infractions.

“Wow, this was a wild ride,” Michael Kitces, chief financial planning nerd at Kitces.com and head of planning strategy at Buckingham Wealth Management, tweeted on Saturday, referring to an article about the matter published last week by Financial Advisor.

A former prospective client of David R. Nute, 72, submitted a written grievance to CFP Board, complaining that she had asked Nute if she could drop off copies of documents she needed for a potential transaction in person at his office instead of transmitting them electronically, according to CFP Board.

After Nute responded that his time was “too valuable” to make the trip to his office to pick up her documents, the former prospective client emailed him and said she no longer wanted to work with him.

Nute responded to her email, stating, among other things: “It is totally ridiculous to expect me to drive into town and waste a couple hours of $1,000 hourly time,” and “I was only trying to help and your reactions tell me why your husband left you.”

The communications between the prospective client and Nute took place about two years ago.

In 2013, CFP Board’s Disciplinary and Ethics Commission issued a warning to Nute about a similar interaction with a prospective client, according to the organization.

“Professionalism should be a part of human decency but if even that can’t be expected then permission to use respected marks should require it,” Eric Jones, a CFP and financial advisor with Baird’s Bowker Jones Group in Rockford, Illinois, tweeted in response to Kitces’ post on Sunday.

“The guy clearly has issues and needs help,” Travis Sickle, a CFP and financial advisor at Sickle Hunter Financial Advisors in Tampa., Florida, tweeted Saturday.

At the same time, Sickle said he thought CFP Board “overstepped” by revoking his certification. The advisor didn’t give an explanation for this opinion, even after Kitces responded by asking, “Genuinely curious, overstepped in what regard/at what point here?” (Sickle didn’t immediately respond to a request for comment by ThinkAdvisor on Monday.)

Sickle, however, wasn’t alone in questioning whether CFP Board overstepped, and the CFP Board declined ThinkAdvisor’s request to comment on the Twitter discussion.

CFP Board’s Order

In July, CFP Board issued an order in which Nute received a revocation of his CFP credential and his right to use the CFP certification marks. The sanction followed an appeal of a January Order of Revocation from the Disciplinary and Ethics Commission.

Nute’s Views

“It’s the height of absurdity,” Nute said in a phone interview Monday about his CFP certification being revoked. “I’m not guilty of hurting any client. All I’m guilty of is trying to defend myself against a board who seems to think that they have the right to change their position at any point for somebody who’s arguing with them.”

What started out as a censure became a revocation of his credential after the hearing, he said, adding: “There’s nothing in their 900 cases of history that they publish on their website that shows anything” like the incident in question here “leading to any type of discipline.”

The measures taken against him were based on “[about] five words” Nute maintained, adding that the prospective client had expressed interest in a reverse mortgage. Nute also admitted that he told her he understood why her husband had left her; the ex-CFP said he did so after she became “huffy” with him.

Nute also complained that he “had to spend $2,500 of my money to defend myself” against the censure and then it became a revocation of his license after he allegedly talked disrespectfully to the CFP Board counsel. The revocation was “just totally absurd,” he said, adding: “I don’t regret a thing.”