Standard VII
- VII Responsibilities as a CFA Institute Member or CFA Candidate
- VII(A) Conduct as Participants in CFA Institute Programs. Members and Candidates must not engage in any conduct that compromises the reputation or integrity of CFA Institute or the CFA designation or the integrity, validity, or security of CFA Institute programs.
Members must not engage in any activity that undermines the integrity of the CFA charter. This Standard applies to conduct which includes:
- Cheating on the CFA exam or any exam administered by CFA Institute (e.g., CIPM). Revealing anything about either broad or specific topics tested, content of exam questions, or formulas required or not required on the exam. Not following rules and policies of any CFA Institute program.
- Giving confidential information on the CFA Program to candidates or the public. Improperly using the designation to further personal and professional goals. Misrepresenting information on the Professional Conduct Statement (PCS) or the CFA Institute Professional Development Program.
Members and candidates are not precluded from expressing their opinions regarding the exam program or CFA Institute but must not reveal confidential information about the CFA Program.
Candidates who violate any of the CFA exam policies (calculator, personal belongings, Candidate Pledge) have violated Standard VII(A).
Members who volunteer in the CFA Program may not solicit or reveal information about questions considered for or included on a CFA exam, about the grading process, or about scoring of questions.
Application of Standard VII(A) Conduct as Participants in CFA Institute Programs
Example 1:
A member who volunteers at a local CFA society schedules her own clients for their regularly scheduled company presentations at the society, while excluding non client firms.
Comment:
The member, by using her volunteer position at a local society to benefit herself and her clients, compromises the reputation and integrity of CFA Institute and, thus, violates Standard VII(A).
Example 2:
A member who is an exam grader discusses with friends the guideline answer for and relative candidate performance on a specific question he graded on the CFA exam.
Comment:
He has violated his Grader’s Agreement and also the Standard by compromising the integrity of the CFA exam.
Example 3:
A candidate does not stop writing when asked to by the proctor at the CFA exam.
Comment:
By taking additional time compared to other candidates, this candidate has violated the Standard, compromising the integrity of the exam process.
Example 4:
A member who is a volunteer on a CFA Institute committee tells her clients that what she learns through her committee work will allow her to better serve their interests.
Comment:
She has violated the Standard by using her CFA committee position to benefit herself personally and to any extent her “inside” knowledge has benefited her clients.
Example 5:
A candidate tells another candidate, “I’m sure glad that Bayes’ formula was not on the Level I test this year.”
Comment:
This is a violation of Standard VII(A). Candidates are not permitted to reveal any formulas required or not required on a CFA exam.
Example 6:
A candidate tells his beloved CFA instructor, “I really appreciate the emphasis that you put on Financial Reporting and Analysis because that was a huge part of the test this year.”
Comment:
This is a violation of Standard VII(A). Candidates are not permitted to disclose the relative weighting of topics on the exam.
Example 7:
A candidate tells his mother, “There was an item set on the CFA exam on the Residual Income Model that just kicked my butt.”
Comment:
This is a violation of Standard VII(A). Candidates are not permitted to disclose specific topics tested on the exam.
- VII(B) Reference to CFA Institute, the CFA Designation, and the CFA Program.
- When referring to CFA Institute, CFA Institute membership, the CFA designation, or candidacy in the CFA Program, Members and Candidates must not misrepresent or exaggerate the meaning or implications of membership in CFA Institute, holding the CFA designation, or candidacy in the CFA Program.
Guidance Members must not make promotional promises or guarantees tied to the CFA designation. Do not:
- Over promise individual competence. Over promise investment results in the future (i.e., higher performance, less risk, etc.).
Guidance, CFA Institute Membership Members must satisfy these requirements to maintain membership:
- Sign PCS annually.
- Pay CFA Institute membership dues annually.
If they fail to do this, they are no longer active members.
Guidance, Using the CFA Designation
Do not misrepresent or exaggerate the meaning of the designation. Use of the CFA designation by a charterholder is subject to terms of the annual Professional Conduct Statement Agreement.
Guidance, Referencing Candidacy in the CFA Program There is no partial designation. It is acceptable to state that a candidate successfully completed the program in three years, if in fact he did, but claiming superior ability because of this is not permitted.
Recommended Procedures for Compliance Make sure that members’ and candidates’ firms are aware of the proper references to a member’s CFA designation or candidacy, as this is a common error.
Application of Standard VII(B) Reference to CFA Institute, the CFA Designation, and the CFA Program Example 1:
Supra Investments has advertised that all of the firm’s directors are CFA charterholders that passed their exams on first attempts. This fact is prominently linked to the firm’s superior performance.
Comment:
Supra can make factual statements (about the qualifications of the directors as well as passing the examinations on the first try) but cannot link these facts to the firm’s performance; to do so would violate Standard VII(B).
Example 2:
A member chose to move out of the investment profession and did not renew his membership with the CFA Institute. Several years later, he decided to pursue an opportunity in private equity and submitted his resume with CFA qualification after his name.
Comment:
The member has violated Standard VII(B) because his right to use the CFA designation was suspended when he stopped paying dues. Prior to using the designation again, the member must complete CFA Institute reinstatement procedures.
Example 3:
A member still uses the initials CFA after his name even though his membership has been suspended for not paying dues and for not submitting a personal conduct statement as required.
Comment:
This is a violation of the Standard.
Example 4:
A member puts the CFA logo on his letterhead, his business cards, and the company letterhead.
Comment:
By putting the logo on the company letterhead (rather than the letterhead or business card of an individual who is a CFA charterholder), the member has violated the Standard.
Example 5:
A member maintains an online account on a popular internet forum using the name “Old_CFA_Charterholder.” The member is not otherwise identified in the forum.
Comment:
This use of the designation violates the Standard because the name hides the member’s identity.