Ethics - what requires WRITTEN permisson? additional, practice, regarding, permission, understand

nixie24

Hey guys,

With all these conflict of interest questions that all are pretty similar, I just wanted to make we're all on the same page regarding what conflicts require written permission vs. just disclosure (no permission required).

The way I understand it (which is shaky at best):

Written Required:
- Gifts from clients for hitting future benchmarks (additional comp arrangements)
- Referral Fees?
- Independent practice

Disclosure:
- Stock ownership in analyzed company
- Board positions

What's missing?



Edited 1 time(s). Last edit at Thursday, June 2, 2011 at 02:19PM by thisisbrianly.

pacmandefense

Awesome idea for a thread. I am sorry I can't contribute, but this will definitely be handy.

THANKS

invic

I don't think written permission is required for "Referral fees" and "Independent practice". Written permission is only required when gifts are promised to hit the future benchmarks, not even in case of past benchmarks. In case of Independent practice, analyst just need to agree on terms and conditions. Terms and conditions may require an analyst to get written permission before he accepts any assignments from any other firm or competing firm.

Disclosure is required in every other situation unless it's a very small token amount and firm clearly specifies that no disclosure is required for token amount under certain limit.

MythosHF

I believe gifts of any kind from a client need to be disclosed, right? And referral fees belong under disclosure.

dmar

Schweser volume 1 AM question #6 - Answer was that portfolio mgr excepted gift (use of condo) and even though she received approval she violated standard because she did not get approval from empoloyer in writing.

I got this wrong b/c I thought just needed verbal consent.

siavosh

I don't have this question, but what was the gift for?

andyrocks Wrote:
-------------------------------------------------------
> Schweser volume 1 AM question #6 - Answer was that
> portfolio mgr excepted gift (use of condo) and
> even though she received approval she violated
> standard because she did not get approval from
> empoloyer in writing.
>
> I got this wrong b/c I thought just needed verbal
> consent.

JPSem

Performance of portfilio at least 2% over S&P over next 12 months

FVPV

additional compensation arrangements, disclosure of conflicts all in writing

rgonzalez

I think there is very fine line between Additional compensation arrangement, disclosure of conflicts and referral fee. Can anyone list down the instances of these arrangements?

hariRaj

"additional compensation arrangements"
Requires written permission, only if likely to be in conflict with current position (e.g., rendering related competitive services, especially in business hours"). See CFAI PM Mock q.13