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CFP Board News - April 2008


UPDATE FROM KEVIN KELLER ON CFP BOARD'S WEB SITE

Over the past two weeks CFP Board's Web site was not accessible to visitors due to extensive maintenance which was necessitated by malicious cyber attack. This attack, which also affected thousands of other well-known sites, attempted to direct visitors away from CFP Board’s Web site to third party Web sites with unknown and possibly dangerous purposes.

Due to the uncertain risks the attack posed to visitors of CFP Board’s Web site, CFP Board chose to respond to the attack with the greatest of caution. The Web site was taken down for an extended period of investigation and maintenance. Taking a Web site offline is a serious decision. It causes inconveniences for all stakeholders and has an effect on an organization's internal operations. CFP Board’s decision to take the most conservative approach to the attack was made to best protect the interest of our stakeholders, safeguarding the integrity of our stakeholders’ data and ensuring that individuals accessing our Web site were not directed to dangerous Internet content.

While access to the online account section of CFP Board’s Web site was removed during the maintenance period, we were able to retain staff access to key portions of our databases. We have conducted a thorough review and have no reason to believe that any certificant data were affected by the cyber attack. The security systems used for CFP Board’s online accounts have been now been enhanced, and you can be confident that your information is protected when submitting transactions through our secure online application forms.

In addition to the extensive maintenance that took place over the past few weeks, we are taking additional steps to ensure that security for CFP Board’s Web site remains high and up-to-date. If you experience any difficulties with the Web site, please contact us at 800-487-1497 or mail@CFPBoard.org.

To all who attempted to access CFP Board’s Web site during the extended maintenance required by this unfortunate situation, thank you for your patience and understanding.

Kevin R. Keller, CAE
CEO, CFP Board

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CFP BOARD AND FPA CO-HOST FINANCIAL PLANNING DAY ON CAPITOL HILL

CFP Board and FPA of National Capitol Area co-hosted the Fifth Annual Financial Planning Day on Capitol Hill on March 28. More than 100 congressional staffers took advantage of the opportunity to meet one-one-one with a CFP® professional to ask questions relating to their personal finances.

CFP Board appreciates the work of Kevin Knull, CFP® and the many volunteers from FPA’s National Capital Area chapter who helped coordinate this successful event.

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CFP BOARD REPRESENTED AT NASAA PUBLIC POLICY CONFERENCE

The NASAA Public Policy Conference held in Washington, DC, on April 1, 2008 featured Senator Jack Reed and SEC Chairman Christopher Cox as keynote speakers.

CFP Board was represented by Michael Shaw, Esq., CLU, ChFC, Managing Director of Public Policy & Legal, on a panel titled “Cutting Through the Confusion: The Future of Investment Adviser Regulation,” moderated by Maryland Securities Commissioner Melanie Lubin.

In response to the question “Should the financial planning profession be regulated?” Mr. Shaw commented as follows:

“Thank you, Commissioner Lubin – and thank you to Russ Lucalano and the staff at NASAA for inviting CFP Board to participate in this important discussion on the Rand Report.

For those who may not be familiar with Certified Financial Planner Board of Standards – otherwise known as CFP Board – we are a private, non-profit organization whose mission is to benefit the public by granting the CFP® certification and upholding it as the recognized standard of excellence for competent and ethical financial planning.

I’ve been asked to address the question – should the financial planning profession be regulated? Let’s first look at the current oversight of financial planners. The financial planning profession is relatively young – it’s been in existence for about 30 years. During that time, it has grown from a service offered mainly by insurance agents and fee-only financial planners to one that today includes investment advisors, their representatives and registered representatives of broker-dealers.

The reason that financial planning has grown so rapidly is that clients want someone they can trust to advise them on all aspects of their financial situation – how much to save for college and retirement, help with tax and estate planning issues and guidance on how much and where to invest their money. Financial planning has evolved to a point today where it is both a process and a profession. Neither is regulated by the federal government nor any state government. Where government regulation comes in is with regard to advice, recommendations and transactions involving financial products.

The Rand Study pointed out, quite clearly, that the public is generally confused about the way that financial professionals are regulated. This confusion stems, in part, from the fact that the products and services offered by financial planners – to cite a few: brokerage transactions, investment advice, and insurance products – are each regulated by a different set of rules and standards.

CFP Board is impacted by this confusion because 30% of its CFP® professionals are registered representatives and 28% are investment advisor representatives of SEC-registered advisor firms.

One of the issues in this discussion of how to address the current confusion is whether all providers of advice and financial planning should be held to the same duty of care to consumers. CFP Board believes that duty should be the “Fiduciary” duty. The fiduciary duty means that when someone is providing financial planning advice to a prospective or current customer, the duty owed is always putting the client’s best interests FIRST.

Placing the client’s interests first may sound like an overly simplified solution to the current problems and, perhaps, a principle that some would think isn’t necessary to adopt as a standard. We have seen, however, in the absence of such a written principle, financial services professionals do not always act in their client’s best interest.

Putting the client’s interest first means providing full disclosure of any conflicts of interest. As examples, informing a potential customer that you offer only proprietary insurance products or, if you’re conducting a brokerage transaction, that your firm requires you to trade from the firm’s account rather than on the open market. The fiduciary standard also requires an individual to disclose how he or she is compensated – whether it is by commissions, fees, or a combination of the two.

CFP Board believes that the focus of the debate on whether or not financial planning needs to be regulated should be on:

  • Empowering consumers through education; and
  • Improving the coordination among regulatory bodies to lessen the compliance burdens on financial professionals so they can devote more time and attention on service to clients.

I should add that CFP Board has recently revised its Standards of Professional Conduct, effective July 1, 2008, to reflect the higher fiduciary duty of care, and has a rigorous enforcement process reflecting the best practices of professional organizations.

CFP Board believes that the financial planning profession should be held to higher standards for the benefit of the public. How those standards are enforced is open to debate, and we look forward to actively participating in that debate. Thank you.”

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CFP BOARD ENDORSES SENATE AND NASAA MEASURES TO PROTECT SENIORS FROM UNQUALIFIED FINANCIAL ADVICE

CFP Board has announced its strong support for two mutually-reinforcing measures intended to stem the proliferation of financial planning designations that are aggressively marketed to seniors. The “Senior Investor Protection Act of 2008,” introduced Tuesday, April 1, by Senators Herb Kohl and David Vitter, and the “New Model Rule on the Use of Senior-Specific Certifications and Professional Designations,” issued Tuesday, April 1, by the North American Securities Administrators Association (NASAA), both seek to codify standards on what constitutes an acceptable financial certification or designation and how those certifications or designations may be marketed.

On behalf of the public, CFP Board has worked closely with the Senate Special Committee on Aging since the September 2007 Committee hearing that first disclosed the depth and breadth of abusive marketing tactics used by unscrupulous financial advisers. At the Committee’s hearing, CFP Board announced the creation of a task force to identify specific steps that CFP Board could take to assist the Committee in combating the fraudulent marketing of financial services to seniors. Similarly, CFP Board was among a handful of publicly-focused organizations that provided input on NASAA’s proposed Model Rule.

“We commend both the Senate Special Committee on Aging and NASAA for identifying effective and practical methods to prohibit the misleading use of senior and retiree designations,” said CFP Board CEO Kevin R. Keller, CAE. “We believe that a client’s best interests are served by a financial adviser who has earned a reputable credential and adheres to an enforceable code of ethics. Seniors can and should demand transparency, accountability, and honesty when choosing how to invest their life-savings.”

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CFP BOARD STATEMENT ON TREASURY BLUEPRINT FOR A MODERNIZED FINANCIAL REGULATORY STRUCTURE

David G. Strege, CFP®, Chair of CFP Board’s Board of Directors, issued the following statement on release of the Treasury Department's Blueprint for a Modernized Financial Regulatory Structure:

“CFP Board commends the Treasury Department for its thoughtful review of our current financial regulatory structure. While most observers agree that a review of market practices is long overdue, this bold and sweeping initiative includes elements that will generate considerable debate in the coming months. Because an effective regulatory structure is vital to both the health of the financial services industry and to the protection of millions of American investors and savers, this blueprint requires a thoughtful examination by all sectors of the financial services industry.

CFP Board, for its part, will assess the potential impact of these proposed changes on the protections provided to the public who seek the advice and counsel of CERTIFIED FINANCIAL PLANNER™ professionals.

CFP Board believes that the financial planning profession should be held to higher standards for the benefit of the public. To that end, CFP Board has revised its Standards of Professional Conduct, effective July 1, 2008, to reflect the higher fiduciary duty of care. We also utilize a rigorous enforcement process that reflects the best practices of professional organizations.

We look forward to taking an active role in that dialogue.”

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PBS SERIES "RETIREMENT REVOLUTION" HIGHLIGHTS VALUE OF WORKING WITH CFP® PROFESSIONAL

Last month, PBS stations across the country began airing a two-part documentary on financial challenges facing the Baby Boomer generation as they approach retirement. The series, hosted by Paula Zahn, takes a comprehensive look at retirement today and makes the point that it's never too late to begin preparation for retirement. The documentary features Dan Candura, CFP®, of CFP Board’s Board of Directors, who works with a couple to discuss how their financial situation can be planned to meet their retirement goals, demonstrating the value of financial planning for the average American.

Check your local PBS listings for showings of Retirement Revolution, or view the series online at www.wttw.com/main.taf?p=46,1.

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PRESIDENT'S ADVISORY COUNCIL ON FINANCIAL LITERACY CREATES VOLUNTEER INITIATIVE

USA Freedom Corps (USAFC) has launched a Financial Literacy Volunteer Initiative to mobilize volunteers that can help homeowners improve their financial literacy and avoid foreclosure in the wake of America’s transitioning housing market. This new initiative provides tools and resources, available at www.usafreedomcorps.gov/flvi, for Americans interested in sharing their financial services, nonprofits in need of skilled volunteers, and homeowners seeking financial guidance.

CFP Board welcomes information about the activities and accomplishments of CFP® professionals. If you have information you would like to share with CFP Board, please contact us at mail@CFPBoard.org.

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BOOKS PUBLISHED BY CFP® CERTIFICANTS

CFP Board congratulates the following CFP® professionals on their publication activities:

Vernon V Chatman III, CFP® on the publication of the article “ß1-Indexing: Reducing Investing Complexity” in the “Between the Issues” online supplement to the Journal of Financial Planning.

Gregory L. Reed, CFP® on the publication of the book Countdown, co-authored with Randall N. Smith.

Melissa Shaw, CFP® on the publication of the Financial Counselor Notebook.

Mary Sterk, CFP® on the publication of the book Buy it! A Practical Guide to Buying a Financial Services Book of Business

Brian Wruk, CFP® on the publication of The Canadian Snowbird in America - Professional Tax and Financial Insights Into Temporary Lifestyles in the U.S. and the upcoming publication of The American in Canada - Real-life Tax and Financial Insights Into Moving and Living in Canada, expected to be published in April or May 2008.

CFP Board welcomes information about the activities and accomplishments of CFP® professionals. If you have information you would like to share with CFP Board, please contact us at mail@CFPBoard.org.

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SEARCHABLE CFP® CERTIFICANT LISTINGS COMING TO BANKRATE.COM

Searchable listings of CERTIFIED FINANCIAL PLANNER™ professionals are expected to be available on the Bankrate.com Web site on April 25. The listings will be made up exclusively of CFP® certificants who have indicated to CFP Board that they practice financial planning and who have not chosen to opt-out of the Bankrate listings. Visitors to the Bankrate site can search the listings by zip code radius, by city, by state, or by name. Individual CFP® professional listings include name, company affiliation, business address and business phone number. No other information resides on the Bankrate site.

Certificants are encouraged to visit the Bankrate site to verify their information. Updates to the contact information should be made through CFP Board’s Web site at www.CFP.net/login. Anyone wishing to remove their name from the Bankrate listings should opt out of the Bankrate.com by checking the appropriate box in their profile at www.CFP.net/login. The Bankrate listings are refreshed in the second week of each month and will reflect any changes to the individual certificant profile.

CFP Board expects its partnership with Bankrate will provide increased visibility for CFP® certification and direct benefits for CFP® professionals who choose to have their information included in the Bankrate listings. If you have any questions about CFP Board’s partnership with Bankrate.com, please contact us at 800-487-1497 or mail@CFPBoard.org.

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CFP BOARD STRENGTHENS CONTROLS ON DISTRIBUTION OF CERTIFICANT INFORMATION

CFP Board periodically reviews its list-sharing policies and makes adjustments to meet the needs of both CFP® certificants and the affiliated organizations that may make use of those lists, including continuing education providers, industry organizations, associations or businesses related to the financial planning industry. CFP Board’s recent review of its Collection and Dissemination of Information Policy (CDIP) led to the creation of policies and procedures to better control the distribution of certificant information.

CFP Board’s CDIP requires that each list CFP Board may provide to a third party be used only once. To better ensure that each list is used only once, CFP Board will no longer provide electronic lists directly to third parties. Under the new policy, CFP Board will provide the names and mailing addresses of certificants on pre-printed mailing labels or deliver them electronically to the third party’s bonded mail house with a one-time use stipulation. CFP Board will not provide third parties with lists of certificant e-mail addresses.

CFP® professionals may opt-out from being included on lists CFP Board provides to education providers, industry organizations, associations or businesses related to the financial planning industry either by selecting the "opt-out of third-party communications" option in the contact information section of their online CFP Board accounts or by sending an opt-out request by fax to 202-279-2299 or by e-mail to mail@CFPBoard.org.

Organizations interested in obtaining lists of CFP® professionals from CFP Board are welcome to send inquiries to lists@CFPBoard.org.

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APPLICATION DEADLINE APPROACHING FOR 2008 FINANCIAL PLANNING GRANTS:
Application Deadline Extended to May 15, 2008

CFP Board has extended the deadline for submitting applications for CFP Board's 2008 Financial Planning Grants program from April 30, 2008 to May 15, 2008.

CFP Board's 2008 grant program is designed to provide financial support to sustainable projects that reach non-traditional populations and encourage them to benefit from financial planning. For more information about the program, visit CFP Board's Web site at www.CFP.net/teamup/grants.asp.

If you are interested in this opportunity but have not yet submitted a proposal, please submit your proposal to CFP Board by e-mail to grants@CFPBoard.org, no later than May 15, 2008.

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COMMUNITY LEADERSHIP AWARDS PROGRAM SEEKS NOMINATIONS

The Invest in Others Charitable Foundation and InvestmentNews seek nominations to the second annual Community Leadership Awards. The program recognizes and celebrates financial advisers across the nation for their exemplary leadership and contribution to their communities. To nominate an adviser who has dedicated time and effort to improving their community and making a difference in the lives of others, or to learn more about the program, visit www.investmentnews.com/apps/pbcs.dll/section?category=CommunityAwards. The deadline for entries is June 20, 2008.

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CFP BOARD SEEKS CFP® PROFESSIONALS TO PARTICIPATE IN A FINANCIAL PLANNING CLINIC IN MIAMI ON SATURDAY, NOVEMBER 15, 2008

CFP Board seeks CFP® certificants to participate in a Financial Planning Clinic on Saturday, November 15, 2008 at the Hyatt Regency at Miami Convention Center. The Clinic will offer pro-bono financial counseling and education to individuals who may not otherwise understand the value of financial planning. The Clinic is an exciting opportunity for CFP® professionals to help a broad range of people with first-hand experience of the benefits of financial planning in a simple format – volunteer CFP® professionals meeting one-on-one with consumers to answer their financial questions.

The Financial Planning Clinic in Miami is the second Clinic CFP Board will host in 2008, together with a Clinic in Washington, DC planned for September. These Clinics build on the successes of similar events CFP Board hosted in Los Angeles and Boston where hundreds of CFP® certificants made a positive difference in the lives of thousands of people by sharing their time and expertise to help individuals, couples and families sort out their personal finance questions and concerns.

For many, the events were an introduction to the benefits of financial planning. More than 95% of attendees found their experience so rewarding that they would recommend it to others, while the same percentage of volunteers stated that they would participate again. Volunteers expressed how much they enjoyed interacting at such a personal level with so many consumers of diverse financial backgrounds.

The Financial Planning Clinic will be held at the Regency Hyatt at Miami Convention Center from 11:00 a.m. to 4:00 p.m. on Saturday, November 15, 2008. Volunteers will be required to participate for the entire time. A 30-minute lunch break and complimentary lunch and refreshments will be available. Only CFP® certificants in good standing with CFP Board may participate.

If you are interested in participating at the Financial Planning Clinic in Miami, apply online or contact CFP Board by e-mail at clinic@CFPBoard.org or by phone at 800-487-1497 with the following information:

  • Name
  • Phone Number
  • E-mail Address
  • Mailing Address
  • If you are multi-lingual, the languages you would like to use at the Financial Planning Clinic
  • The general financial planning topics you are most interested in discussing with attendees
For additional information about CFP Board’s Financial Planning Clinic in Miami, visit www.CFP.net/clinic/Miamivolunteers.asp.

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WORKSHOP PRESENTERS SOUGHT FOR 2008 FINANCIAL PLANNING CLINICS IN WASHINGTON, DC AND MIAMI

CFP Board seeks CFP® certificants for presentations at educational workshops for consumers during CFP Board’s 2008 Financial Planning Clinics in Washington, DC and Miami. Local CFP® certificants are sought since we cannot reimburse expenses. The 50-minute workshops will discuss specific financial planning topics, including strategies and action items. In addition, the Clinics also will offer attendees one-on-one consultations with volunteer CFP® professionals.

The educational workshops are geared toward a diverse group of attendees and will feature the following topics:

  • Investment Planning for Retirement Assets
  • Planning for Retirement at Any Stage in Life - When to Start?
  • Financial Planning for Special Needs
  • Estate Planning Basics and How to Implement Them
  • Is Debt a 4-letter Word? Managing Debt: From Credit Cards to Foreclosures
  • Living Beyond Paycheck to Paycheck
  • Young Professionals: Launching Your Financial Plan
  • Tax Planning for Moderate Income Households
  • College Funding and Planning
  • Financial Planning for the Sandwich Generation

If you would like to be considered as a workshop presenter, please contact CFP Board by e-mail at clinic@CFPBoard.org or by phone at 800-487-1497 with the following information:

  • Name
  • Phone Number
  • E-mail Address
  • Summary of Qualifications
  • Past Speaking Engagements
  • Spanish Fluency (Miami Clinic will also feature workshops in Spanish)

The Financial Planning Clinic in Washington, DC will be held on Saturday, September 13 from 11:00 am to 4:00 pm at the Grand Hyatt Washington.

The Financial Planning Clinic in Miami will be held on Saturday, November 15 from 11:00 am to 4:00 pm at the Hyatt Regency at Miami Convention Center.

For more information on CFP Board’s Financial Planning Clinics, visit www.CFP.net/clinic.

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