PJStyles Wrote: ------------------------------------------------------- > wife’s account was a discretionary account that he > had beneficial interest in. Therefore, I chose no > violation by leaving out his wife’s account for > over-subscribed IPO’s. that is correct, we had discussion about it before
cool!
the guy was married? i don´t even remember this… 
i remember something about allocating only to those discretionary portfolios who usually request these things… which for me is a violation, because you should allocate to all discretionary portfolios just guessing, had no idea about this one I agree there were 3-4 tricky, but because answer was subjective (for example, the one about firing a manager or lowering allocation… you just guess, that is nowhere in the curriculum)
But firing the manager right away. would that evidence be considered enough? I think somewhere in the text (performance evaluation i guess) that there should be a formal review procedure for firing the manager. Is that just a recommendation or do standards say, fire right-away if someone is debiting someone else’s account. BTW, the reviewing person’ s demand was also unethical, to let the shares stay in his account, since it was IPO allocation and must be allocated fairly. I thought they would ask question about that, but they didn’t. I do have a couple of questions to confirm: 1. If someone had a disciplinary action taken against him in the past, do standards bind not to hire such person or do standards bind to disclose such history to the clients? 2. What about the guy who was being paid for his son’s sports activities. Was he to disclose to his employer only, or to the clients as well?
I said it was fine to keep him on whilst evaluating, but then, by q6, he had to go. I fired that SoB.
disclose to his clients as well as employeer
sure about that? hmmm, +3 for me then 
I put a violation to the ‘keeping him while evaluating’ Because the question wasnt about ‘keeping him’ it was about his thought processes in keeping him. One of which included the political reason which violates 1B.
At first i chose to fire the manager. Then again I thought bout it and changed my answer to 'Reduce allocation until something (forgot)"… my reason is that he is providing superb diversification and returns, well it would not b to the best interest to your clients to terminate the manager immediately. And what standard is it that says u must fire a manager?
if i give you a mandate to manage my bond portfolio, and you give me +50% performance because you are long oil futures… you should be fired, regardless of your performance
fired him. my firm would be fired very quickly if we ever purposefully deviated from a legal investment policy statement, whether we earned attractive returns or not. unintentionally allocating a restricted asset is one thing, blatantly ignoring ips guidelines is another. at least that’s how it would be for my accounts in the real world, so i fired them on the exam.