Hi, I’m confused by CFA text regarding the client list. It says that you cannot take the client list from previous employer with you. However, it then stays that simply knew the name of previous client is not a violation of IV(A). So my question is: If I just write down all the names of my clients before I left previous employer, and then call the client by the phone number from the yellow page. Is that a violation of the IV(A)? Thanks!
i would say yes, but not sure. my feeling is you have to have the names comitted to memory??? did you see a question like that on the test ??? that is very tricky if you did clinets are like models - you cant take it to the next firm unless from memory. i know sell siders have to recreate all models when they hop firms, so I assume they have to “create” those client lists, too sorry for the cloudy response
Definitely a violation. Only names and numbers committed to memory providing you didn’t sign a non-compete agreement.
EcK52 Wrote: ------------------------------------------------------- > Definitely a violation. Only names and numbers > committed to memory providing you didn’t sign a > non-compete agreement. thanks, that sounds right
daj224 Wrote: ------------------------------------------------------- > clinets are like models - you cant take it to the > next firm unless from memory. i know sell siders > have to recreate all models when they hop firms, > so I assume they have to “create” those client > lists, too As for models, you must also recreate the supporting documentation/research that went into the model.
busprof Wrote: ------------------------------------------------------- > > As for models, you must also recreate the > supporting documentation/research that went into > the model. thanks B!
Thanks!
EcK52 Wrote: ------------------------------------------------------- > Definitely a violation. Only names and numbers > committed to memory providing you didn’t sign a > non-compete agreement. I tend to say ‘yes’, but not “definitely”. The member didn’t take previous employer’s record. Writing down of the information is point of the issue. In my opinion, writing down of information makes no difference of copy a electronic file or photocopy a client list. Thus, it is a violation. However, if the member just recalled it and not copy or take the information, I would say no violation.
How do you pass level I without know this?
johnnyblazini Wrote: ------------------------------------------------------- > How do you pass level I without know this? Johnny: My initial reaction was similar. But them I realized that many people pass L1 with some areas nailed down and weaknesses in others. I constantly have to look up my ethics, because it was (along with FSA) my weakest area (I’m now reading L3 ethics, and still make the same damn mistakes I made on L1 and L2). Luckily, I nailed other sections to make up for it. I’m probably not alone there.
johnnyblazini Wrote: ------------------------------------------------------- > How do you pass level I without know this? go over ethics at least 3x before test. it is tricky and it is heavily tested.
busprof Wrote: ------------------------------------------------------- > johnnyblazini Wrote: > -------------------------------------------------- > ----- > > How do you pass level I without know this? > > Johnny: > > My initial reaction was similar. But them I > realized that many people pass L1 with some areas > nailed down and weaknesses in others. I > constantly have to look up my ethics, because it > was (along with FSA) my weakest area (I’m now > reading L3 ethics, and still make the same damn > mistakes I made on L1 and L2). Luckily, I nailed > other sections to make up for it. > > I’m probably not alone there. I hear that argument, it just seemed like a VERY basic question…
i dont think it is a very basic question. i think it is a loophole actually. one could theoretically sit down and memorize a list of names alone. once they have these names committed to memory, its in their head and they can take it with them. there may be a violation in memorizing the names simply to avoid the violation, but the ethics doesnt cover that. maybe under conduct of a CFA or honesty somewhere or another code violation. but i dont think its a clear violation of the IV A. clear as mud in my mind
You are allowed to take whatever is in your head… Although it would be dishonest to do this on the last day at the office, you would probably get away with it. In any case, I don’t see this being a question on the exam, its just beyond the curriculum…
if you take anything from a previous employer when leaving that is proprietary, it being a model or client list, for the purposes of the exam it is emphatically a violation. If you have anything on a home computer that you used while previously employed, it is still a violation if you use it in the context of your new job. For the exam, there is very, very little grey area here. you can recreate anything you want from memory. if its a model, you have to give proper documentation.
i thought the issue in this post is not a client taking a client list or model from an employer. its committing it to memory before jetting. you got to admit, its a tricky question. the CFAI says you can take what you have in your head. what if you cram your head with a bunch of client contact info and then later claim that you just happen to remember it? you didnt take anything proprietary. therefore, i say its not a direct violation of IVA, but like johnnyblazini said. its unethical and dishonest. im sure it violates something somewhere, not sure what that would be though. the bottom line is on the test, i would check the box that says this is not a vio of IV A unless he spends a ridiculous amount of time memorizing a bunch of names?
Intellectual property is just not defined by the format it’s recorded in. If you take an employer’s proprietary model in your head and use it, the intellectual property theft is the same as if you wrote it down (but harder to prove). In the US, intellectual property theft is a much bigger deal than just worrying about CFAI. Theoretically, you can be subject to Federal prosecution under corporate espionage laws. A client’s name is probably not protected intellectual property without a non-solicitation agreement because it’s probably not protected adequately. If your clients are known throughout the firm by code names and their real identities are kept secret from most employees and you call them after you leave, you can be busted under something like uniform trade secrets act.
Re: Ethics - Duty to employer - client list new Posted by: SkipE99 (IP Logged) [hide posts from this user] Date: October 1, 2008 09:23AM i dont think it is a very basic question. i think it is a loophole actually. one could theoretically sit down and memorize a list of names alone. once they have these names committed to memory, its in their head and they can take it with them. there may be a violation in memorizing the names simply to avoid the violation, but the ethics doesnt cover that. maybe under conduct of a CFA or honesty somewhere or another code violation. but i dont think its a clear violation of the IV A. clear as mud in my mind - - - - - - - - - If someone sat there an memorized the list every day for two weeks before they left, it sounds like a ‘spirit of the code’ violation rather than a code violation. So they don’t actually violate the code, but are not upholding the essence of it.