…Are you next? To borrow the motto of the Boy Scouts of America:
You know the best offense is always a good defense. Not defensively burying files, shredding documents or wiping computers. Rather, we’re talking about creating a culture of compliance and implementing the policies, procedures and systems to make it easier for your members to be compliant.
Earlier this month, the Certified Financial Planner Board of Standards, Inc. (CFP Board) took disciplinary actions of varying severity against 10 current or former CFPs®. Bad actors received letters of admonition, suspensions, and permanent revocations. Also their names were made public and the CFB Board alerted consumers they could check an individual’s disciplinary history and certification status at www.CFP.net/verify.
Some of the censures were for untimely responses to regulatory requests; others for unreported outside business activities, still others for overall bad business practices. Among those punished are:
Aaron Parthemer of Fort Lauderdale, FL, who, in addition to other misbehaviors, lost his right to use CFP® certification marks for failing to give prior notice or obtain approval for outside business activities (OBAs) and also falsely stating in his employer’s compliance questionnaire that he was not participating in any OBAs or private securities transactions. Worse yet, he also provided false information and documents to…FINRA.
Ya can’t make this stuff up!
Because reality is stranger than fiction.
As though filing for bankruptcy once wasn’t bad enough, Allen Mitchell of Decatur, GA filed for Chapter 7 Bankruptcy two times. The first was in 1996; the second in 2013. While closing one’s doors is bad enough, the CFP Board took action because he failed to file an answer to the CFP Board’s Complaint within the required, 20 day time period, violating one of the cornerstones of compliant compliance: Give the regulators what they want when they want it.
By not responding, the allegations in the CFP’s complaint were deemed admitted and he lost his right to use the CFP certification marks. Ouch!
Worse yet, the CFP Board published the following Wall of Shame:
|California||Harold S. Kern, CFP®||San Jose||Letter of Admonition|
|Florida||Aaron R. Parthemer||Fort Lauderdale||Revocation|
|Georgia||Allen L. Mitchell||Decatur||Administrative Revocation|
|Michigan||Sean E. Mattson, CFP®||South Lyon||Letter of Admonition|
|Missouri||D. Robin Walker||Verona||Suspension|
|Pennsylvania||Deborah S. Giffin, CFP®||McMurray||Letter of Admonition|
|Pennsylvania||James P. O’Mara||York||Suspension|
|Utah||Gary L. Barker, CFP®||Salt Lake City||Letter of Admonition|
|Virginia||Roxanne K. Villarreal, CFP®||Reston||Letter of Admonition|
|Washington||Kevin R. Bonner, CFP®||Burien||Letter of Admonition|
What do bad actors acting badly mean for you
Extra scrutiny. Even though many of these listed deliberately kept their firms and compliance professionals in the dark, it can’t be a good thing when one of your members goes off the rails…
The regulators know that stuff happens. And when it does, you know they’ll be looking at your compliance processes and procedures. What will you show them?
No one is immune from regulation
Bad actors notwithstanding…regulatory compliance requirements are getting more all-consuming and complying can often times feel like an undertaking without end. If your compliance function is under pressure to do more with less, what are your options? Let’s talk (212-233-1155). Ask about Patrina’s comprehensive compliance solutions and compliance recordkeeping specifically designed for the financial services community.
Let’s talk. Because compliance matters.