An Ethics related doubt

As per schweser, related to additional compensation we need to get written consent from all parties involved. But if you not question 13 on page 113 of CFAI and it’s answer provided, it states although the private compensation arrangement could conflict with the interests of other clients, members may enter into such agreements so long as they have disclosed the arrangements to their employer. I was under the impression member should not act on any thing which goes against the interest of clients. I am a bit confused here. Can some one please provide some clarity.

Is this hte example where the client says if you beat my benchmark by 10% I’ll give you $20,000 or somethign along those lines? If so, you have to get consent from only your Employer b/c obviously your client is ok with it as it was their idea plus the reason you have to tell your employer/supervisor is so that they can ensure that you are not taking unnecessary risks and/or you are not neglecting your other clients.

I think the key phrase above is “could conflict with the interests of other clients” - my first thought is not allowed even you get permission form whoever. WTF…

Funny thing is I’m reading Stalla’s Ethics and it states, “Written consent from all parties involved must be obtained prior to entering into such arrangements”…now by “all parties involved” I believe they are referring to only those involved in the Additional Compensation Arrangement and not all your clients that are not involved…

Bigwilly, a side question - are you listening to the Stalla lectures for the second review?

NO! Never did. That would be way too much of my time. Once was enough :). Although if there is a part I’m havign trouble with, I “may” review a lecture but I dont think i will…how about you?

I do want to go over some study sessions - not all. For example, I need to review SS 16 & 17 and maybe a little bit of fixed income. Listening to all of them is going to take way too much time. Doing the Stalla Mock this year?

No, I never took that either…Figured I can do my own Mock ;). As time gets closer I just may have to relisten to some lectures but I do wish they were shorter at times :slight_smile:

I’m bumping this one up as I thought I saw something similar on Sample#1. There (managing some friends’ portfolios) CFAI said you had to inform everybody AND get written consent from everybody. I can understand employer written consent. That much is clear. But did they also say I needed written consent from the non-firm clients that I’m managing money for? They already asked me to manage their money, and they GAVE me their money. Why would I need written consent? Anybody else remember seeing this?