CFP Board to publicize bankruptcy cases, ease application process


The Certified Financial Planner (CFP) Board of Standards decreased the amount of experienced needed to become a CFP professional and made bankruptcy cases available to the public, among other disciplinary changes.

“The changes reinforce our certification’s status as the standard for ethical and competent personal financial planning. Both consumers and CFP professionals as well as candidates for certification benefit from these changes because they strengthen its standing,” Dan Drummond, director of public relations for the CFP Board, told IFA. “Through enhancing public disclosure of bankruptcies, encouraging candidates for certification to work directly with clients to meet their experience requirement and providing clarity to our disciplinary rules we are continuing to raise the bar for the profession, as well as the certification.”

Starting Sept. 1, potential CFP professionals can meet the experience requirement in two years instead of the traditional three years if: they work under the direct supervision of a CFP professional; they provide direct financial planning services to clients; and all six steps of the financial planning process are documented.

“We recognize this is best form of experience for candidates to develop expertise and sharpen the skills needed to deliver personal financial planning services independently as a CFP professional,” said CFP Board of Directors Chair Alan Goldfarb in a statement.

The procedure also changed concerning discipline for CFP professionals who filed a single bankruptcy within the past five years and are not under investigation by CFP Board for any other conduct. These “bankruptcy-only cases” will be disclosed, starting July 1, through a press release and on CFP professionals’ public profiles on the CFP website, whereas before bankruptcy cases were not publicly available.

Other disciplinary changes, effective June 1, give the CFP Board more power, including: treating an individual’s failure to respond to a request for information for an investigation as admitting to allegations in the complaint; permitting the CFP Board to issue an interim suspension without a hearing if it has evidence of a conviction or professional suspension; and permitting CFP Board to share investigative information with government regulators and industry self-regulatory organizations (SROs).

Each of the proposed changes were exposed to public comment, after which they were approved as final changes, according to the CFP Board.


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