Toronto - Effective January 1, 2006, it is Financial Planners Standards Council's (FPSC) policy to publicly report on disciplinary actions taken by FPSC against individuals' rights to use the CERTIFIED FINANICAL PLANNER® (CFP®) marks. Following is a report of actions taken since January 2006.
"The public disclosure of disciplinary actions taken against individuals among our 17,000-strong CFP professional community is a natural progression for a relatively new certification body such as ours, and for the newly emerging financial planning profession," says FPSC Acting President and CEO Cary List.
The FPSC Board of Directors approved changes to FPSC's Disciplinary Rules and Procedures that effectively removed all references to private disciplinary actions. The change was made in recognition of the importance of public disclosure of the actions FPSC takes to ensure the public can continue to rely on the growing numbers of CFP professionals to help them meet their life goals through the strategic management of their financial affairs.
The report is posted in full on FPSC's website at www.cfp-ca.org.
About Financial Planners Standards Council (FPSC):
Financial Planners Standards Council is a not-for-profit organization established in 1995 to foster professionalism in personal financial planning. FPSC develops and enforces the highest standards in financial planning competency and ethics for individuals who hold the CFP® (CERTIFIED FINANCIAL PLANNER®) in Canada. There are currently about 17,000 CFP professionals in Canada and close to 100,000 individuals who have earned CFP certification in 18 countries around the world. See www.cfp-ca.org for more information.
Report on Actions taken since January 2006:
In accordance with FPSC's Disciplinary Rules and Procedures, all complaints made against CFP professionals are investigated by the Director, Ethics and where appropriate, referred to the Ethics and Practice Committee for a formal disciplinary hearing. The objectives of this process include the protection of the public and the protection of the reputation of the profession.
In each case, a Hearing Panel comprised of a member of the Ethics and Practice Committee and two additional volunteers from the CFP professional community is formed to hear the case and to make a determination of whether or not there has been a breach of the CFP Code of Ethics. Where there is a finding of a breach of the Code, a range of sanctions can be imposed upon the CFP professional up to and including the permanent revocation of the right to use the CFP marks.
The following individual's right to use CFP marks has been permanently revoked:
Brick, Robert (Woodstock, ON)
The following individuals have received admonishments and continue to hold the right to use the CFP marks:
Cloth, Jason (Richmond Hill, ON)
Klimkowski, Ludwik (Ottawa, ON)
McKay, Iris (Winnipeg, MB)
Stokman, Andrew (London, ON)
Totrov, Serguei (Toronto, ON)
Details of Hearing Results:
Brick, Robert (Woodstock, Ontario)
In June 2006, a Hearing Panel of the Ethics and Practice Committee issued a decision revoking Mr. Brick's right to use the CFP marks. Mr. Brick was found to be in breach of Rules 101 and 202 of the CFP Code of Ethics when he was engaged to file tax returns for his client and failed to do so. Mr. Brick was also found to have misled his client in respect of his assurances that the tax returns were filed when they in fact had not been. Further, the Hearing Panel found that Mr. Brick was in breach of Rule 704 of the Code when he failed to provide notification to his client of ceasing to act in respect of a mortgage transaction. Mr. Brick failed to respond to the Director, Ethics in the course of the investigation and failed to appear at the hearing. Mr. Brick's right to use the CFP marks has been permanently revoked.
Cloth, Jason (Richmond Hill, Ontario)
In May 2006, a Hearing Panel of the Ethics and Practice Committee issued Mr. Cloth a Letter of Admonishment, in accordance with a settlement agreement reached with FPSC. Mr. Cloth admitted that he acted in breach of Rule 607 of the CFP Code of Ethics in failing to report a lawsuit made against him in four separate license renewal periods, thereby failing to comply with all post-certification requirements established by FPSC. Mr. Cloth retains the right to use the CFP marks.
Klimkowski, Ludwik (Ottawa, Ontario)
In May 2006, a Hearing Panel of the Ethics and Practice Committee issued Mr. Klimkowski a Letter of Admonishment. In addition, Mr. Klimkowski was required to complete a program of remedial studies within a specific time frame or be subject to a suspension of his license for failing to do so. The Hearing Panel found that Mr. Klimkowski acted in breach of Rules 606(b) and 607 of the CFP Code of Ethics when he took his client's password with consent and performed online trading in the client's securities account. The Hearing Panel also found that Mr. Klimkowski recommended and implemented an aggressive investment portfolio that could not be reconciled with the Know Your Client information on file, constituting a breach of Rule 702 of the Code. Mr. Klimkowski retains the right to use the CFP marks.
McKay, Iris (Winnipeg, Manitoba)
In May 2006, a Hearing Panel of the Ethics and Practice Committee issued Ms. McKay a Letter of Admonishment, in accordance with a settlement agreement reached with FPSC. Ms. McKay admitted that she acted in breach of Rule 702 of the CFP Code of Ethics when she recommended and implemented a leveraged investment that was not suitable for her client. Ms McKay also admitted a breach of Rule 303 when she intervened in the personal affairs of the client by taking ownership of the investment and servicing the client's debt personally. Ms. McKay was disciplined by the Manitoba Securities Commission and made full disclosure to FPSC. Ms. McKay retains the right to use the CFP marks.
Stokman, Andrew (London, Ontario)
In March 2006, a Hearing Panel of the Ethics and Practice Committee issued Mr. Stokman a Letter of Admonishment, in accordance with a settlement agreement reached with FPSC. Mr. Stokman admitted that he acted in breach of Rule 201 of the CFP Code of Ethics in failing to exercise reasonable and prudent judgment by not conducting a due diligence review of an investment prior to recommending it to his clients. The investment was later determined to be of a fraudulent nature. Mr. Stokman also admitted that the resultant failure to act in the best interests of his clients was also a breach of Rule 202 of the Code. Finally, Mr. Stokman admitted that in placing the investments in question, he was acting beyond the authority of his dealer relationship and contrary to applicable laws, rules and regulations, resulting in disciplinary action being taken by the MFDA and also constituting a breach of Rule 607 of the Code. Mr. Stokman retains the right to use the CFP marks.
Totrov, Serguei (Toronto, Ontario)
In June 2006, a Hearing Panel of the Ethics and Practice Committee issued a decision requiring Mr. Totrov to complete a program of remedial studies within a specific time frame or be subject to a suspension of his license for failing to do so. The Hearing Panel found that Mr. Totrov did not exercise reasonable and prudent professional judgment, in breach of Rule 201 of the CFP Code of Ethics, did not to act in his clients' best interests, in breach of Rule 202 of the Code, and did not make and implement only those recommendations which were suitable for his clients, in breach of Rule 702 of the Code. Mr. Totrov had placed substantially all of his clients' retirement savings into a speculative investment without having taken sufficient time to get to know the clients and without taking sufficient care in selecting the investment. The Hearing Panel specifically decided that Mr. Totrov must complete the Canadian Securities Course. Mr. Totrov retains the right to use the CFP marks.
CFP®, CERTIFIED FINANCIAL PLANNER® and are certification marks owned outside the U.S. by Financial Planning Standards Board Ltd. (FPSB). Financial Planners Standards Council is the marks licensing authority for the CFP marks in Canada, through agreement with FPSB.
are certification marks