SEC Gives CFP Board Chance to Dig Deeper on Complaints

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SEC Gives CFP Board Chance to Dig Deeper on Complaints

Apr 24, 2011

Investment advisers and brokers hoping to become certified financial planners, or those wanting to renew their certificates, now have to disclose details about customer complaints to the CFP Board of Standards – a change in procedure that will give the organization's enforcement arm more muscle.

Last week, the Certified Planner Board of Standards Inc. re-leased a letter from the Securities and Exchange Commission giving it permission to obtain background information about complaints filed against brokers and advisers. Until now, such requests could be refused on the grounds that fulfilling them might violate an SEC regulation designed to protect customer privacy.

But in the letter, Joseph Furey, acting co-chief counsel of the SEC's Division of Trading and Markets, said the agency will not take action against advisers who provide the complaint information, giving the CFP Board an exception to so-called Regulation S-P.

"It is very, very frustrating to feel that you've got allegations that are serious in nature but you simply can't gather the evidence to substantiate those allegations," said Michael Shaw, who oversees compliance, enforcement and legal functions at the CFP Board. "My hope is that with this no-action letter, we will have cooperative relationships with firms and be able to get to the bottom line of the allegations." Read more >

Investment News
Mark Schoeff Jr.
April 24, 2011

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