Q10. Tucson Financial Advisors (TFA) has determined that it needs to have the ability to conduct in-house research to support its other activities. To this end, TFA has recently hired Alba Hernandez, a CFA charterholder in good standing, as an investment analyst. Hernandez becomes the first full-time employee of TFA to have the CFA designation. When she is hired, her supervisor tells her that TFA is familiar with the CFA Institute Code and Standards, but that the company does not feel that they are important. TFA is a well-respected firm with a reputation for integrity that predates the CFA program. TFA tells her that they do not plan to use Hernandez’s affiliation with CFA Institute in any of their literature or advertisements. Prior to her employment with TFA, Hernandez was an independent contractor, providing financial advice for a fee to private clients. She continues to do so but has informed these clients not to reveal this fact to TFA. Some of her private clients would be considered viable prospects by TFA, while others would not meet TFA's $1 million net worth criterion. Hernandez routinely uses TFA’s data and other research materials in servicing her private clients. Throughout the year, Hernandez holds a "quarterly investment forum" under the guidance of TFA. Prospects find out about the meetings via private mailings from TFA, which Hernandez supervises. In composing the mailing list, Hernandez is aware that many of the clients do not meet TFA’s $1 million net worth criterion. After each forum, Hernandez often contacts those attendees that do not meet TFA’s criterion, and she solicits them to become clients in her private practice. ChemMex is a large conglomerate headquartered in Monterrey, Mexico. At present, ChemMex is planning an IPO in the U.S. TFA is seeking the mandate for the IPO, and has asked Hernandez to meet with management to present a proposal. Hernandez's uncle, Hector Lopez, is CFO and treasurer of ChemMex. In recent years, Lopez has given ChemMex securities to his nieces and nephews as Christmas gifts. TFA is not aware of Hernandez's financial interests and personal connections with ChemMex. Hernandez is putting together a research report on CoppOre, a firm that mines copper in a developing country. She obtains insider information that states a rival firm in that country will soon make a tender offer for CoppOre. Hernandez knows the laws in that country very well and knows that trading on inside information is not illegal there. Hernandez plans to write the research report exaggerating the facts on positive points in order to encourage her clients to purchase shares in CoppOre, but she does not plan to explicitly say that CoppOre will soon be bought out in a tender offer. In doing so, the clients will be encouraged to buy CoppOre stock while not knowing about the tender offer. Hernandez feels that this is part of her fiduciary duty and explains her plan to TFA management. The managers of TFA tell her to do what she thinks is in the best interest of the clients. Concerning her private clients, Hernandez: A) must obtain written consent from TFA to continue the relationship. B) must discontinue her independent practice. C) must obtain written consent from TFA only if the private practice was not disclosed orally during the hiring process. | 
发表于 2009-1-9 17:10
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