Federal and State Regulation FAQ - CFP Board

For CFP® Professionals


Federal & State Regulation


The new Code and Standards takes effect Oct. 1, 2019, and includes a range of important changes, including expanding the scope of the fiduciary standard that requires CFP® professionals to act in the best interest of the client at all times when providing financial advice.  Learn More


Look here for questions regarding how CFP Board’s Standards relate to current federal and state regulation.

CFP Board wants all CFP® professionals to have a thorough understanding of the Standards of Professional Conduct. Questions not answered in these FAQs may be sent to standards@cfpboard.org for consideration and possible inclusion in future revisions of this document.

Question 6-1: How do the Standards relate to federal and state statutes, rules, regulations and case law with respect to the obligations of a CFP® professional?

The Standards require a CFP® professional to be in compliance with applicable regulatory requirements governing professional services provided to the client. [See Rule 4.3]  The Standards apply to all CFP® professionals regardless of the licenses, certifications or registrations each holds.  Thus, the Standards are only binding upon the CFP® professional and are not intended to alter or define currently existing federal, state or self-regulatory requirements. As such, the Standards clearly provide that CFP Board’s ethical standards “are not designed to be a basis for legal liability to any third party.” [See Introduction to Rules of Conduct and Financial Planning Practice Standards]CFP Board has authority only over the individuals to whom it has granted CFP® certification; CFP Board does not certify broker-dealers, investment advisory firms, mutual fund companies, hedge funds or other entities, and those entities are therefore not required to abide by CFP Board’s Standards.

Question 6-2: Why doesn’t CFP Board use the same definitions used by federal and state regulators and courts for important terms such as “financial planning” and “fiduciary”?

No single definition of either “financial planning” or “fiduciary” has wide acceptance among either regulators, firms or professionals. CFP Board felt it important to establish definitions appropriate for CFP® professionals in a manner that would be understood by CFP® professionals and the clients they serve. The terminology used in CFP Board’s Standards was crafted to be relevant to the activities of those who hold CFP® certification and to facilitate CFP Board’s enforcement of its Standards.

Question 6-3: Will the Standards be applied differently for CFP® professionals with different licenses or registrations (such as registered representatives, investment adviser representatives, insurance agents)? 

No. The Standards apply to all CFP® professionals, regardless of the licenses or registrations each holds, and regardless of the specific business or compensation structure each uses. 

Did This Answer Your Question?

CFP Board welcomes questions about specific aspects of the Standards of Professional Conduct and their application to specific situations.

CFP Board will consider all questions submitted and draft a response where it determines that interpretation of the Standards is needed.  For responses that it believes would be helpful to all CFP® professionals, CFP Board will publish its response in CFP Board’s newsletters and on CFP Board’s website.

Send your questions and requests for guidance documents to CFP Board at standards@cfpboard.org.

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