Kenny Barrett, CFA, is working in the Australian office of American Investments Co. From an informal conversation, Barrett learns that the company’s most recent investment report was based on misappropriated information. No one at the Australian office expresses concern, however, because there has been no breach of Australian law. Barrett should:
A) do nothing because the branch is outside of U.S. jurisdiction.
B) disassociate himself from the case with a written report to his supervisor.
C) seek advice from company counsel to determine appropriate action.
Your answer: B was incorrect. The correct answer was C) seek advice from company counsel to determine appropriate action.
Kenny’s best choice is to seek the company counsel’s advice. If Kenny does nothing, he is breaching Standard I(A) Knowledge of the Law. Disassociation is not enough.
Q: Since the question states “No one at the office expresses concern”, I suppose we are not wrong to assume that company’s counsel is among those included? Or counsel is actually external company?
Thanks.作者: johnnyBuz 时间: 2011-7-13 16:34
In my opinion, I think it has to do with the way Kenny found out about the breach, an informal conversation, which is not a verified source. He should find out exactly what the matter was before disseminating.
Just the way I see it.
Regards,
T作者: manasib 时间: 2011-7-13 16:34
Correct - because Kenny has not taken further steps to confirm the validity of the alleged misappropriation there is no reason to disassociate just yet. One of those steps is to first verify through the organization's compliance dept or the company counsel, and seek appropriate action. After Kenny has gone through mulitple tribulations in confronting the violators and that proves to have no effect, only then Kenny must disassociate himself.作者: hariRaj 时间: 2011-7-13 16:34
I think this questions is a bit ambiguous. Informal convo + no one does anything + no Australian law breached. However, there is the sense that something is wrong. I think in this type of case. It is always good to consult legal.作者: Micholien 时间: 2011-7-13 16:34
I chose B because I thought going to a supervisor was always the first step before legal. I know it said disassociate by going to a supervisor, but I remember getting questions wrong by saying go to legal and they said report to supervisor作者: dcfox83 时间: 2011-7-13 16:34
+1 skpatnala
When a member feels a law has been broken, the member should seek advice from the firm’s counsel. If the member feels the advice is unbiased and competent, the member should follow it.
If the member knows a law has been violated, the member should contact a supervisor.
