Hey, guys. Can someone give me a brief summary of when we are required and when we are encouraged to inform government authorities of illegal or possibly illegal actions of clients, employer and colleagues? Thank you!
look in SS1
The rule for clients is a bit murky. On the one hand they state that client confidentiality trumps all but on the other, if applicable laws allow for disclosure then you may be within your right to disclose illegal client activites. If, in doubt refer to compliance dept. I may have not understood this part. With respect to Employers, not withstanding the fact that you have to be loyal to your employer, if the employer’s actions directly compromise the integrity of the markets or are against the best interests of the client, then you are encouraged to go to the authorities. For colleagues, I believe you report it to your immediate superior and/or the compliance dept.
This is pretty much correct. Clients is the popular one, and you are not REQUIRED to report them to the authorities, but if the CFAI or some other regulatory body starts asking you questions, you obviously must comply. C3Po Wrote: ------------------------------------------------------- > The rule for clients is a bit murky. On the one > hand they state that client confidentiality trumps > all but on the other, if applicable laws allow for > disclosure then you may be within your right to > disclose illegal client activites. If, in doubt > refer to compliance dept. I may have not > understood this part. > > With respect to Employers, not withstanding the > fact that you have to be loyal to your employer, > if the employer’s actions directly compromise the > integrity of the markets or are against the best > interests of the client, then you are encouraged > to go to the authorities. > > For colleagues, I believe you report it to your > immediate superior and/or the compliance dept.
Thank you guys! So CFAI does not oblige us to voluntarily inform the gov authorities about violations and I can just dissociate from the illegal activity and I’m ok?
Deimon Wrote: ------------------------------------------------------- > Thank you guys! So CFAI does not oblige us to > voluntarily inform the gov authorities about > violations and I can just dissociate from the > illegal activity and I’m ok? I don’t believe it is so black and white. Whilst there are standards set by CFAI I think that common sense should prevail. If you believe that a client, employer or colleague is involved in nefarious activities, then reporting to a superior, authority, or compliance should benefit you more than do you harm. My interpretation, not witstanding CFAI’s guidelines.
Yes, but you won’t have a chance to argue for your point on the exam. I found it easier for me to just memorize a few points rather than relying on the common sense (sometimes me and CFAI have different concepts of what’s right and what’s wrong 
Deimon Wrote: ------------------------------------------------------- > Yes, but you won’t have a chance to argue for your > point on the exam. I found it easier for me to > just memorize a few points rather than relying on > the common sense (sometimes me and CFAI have > different concepts of what’s right and what’s > wrong Agree!!