New guidance helps CFP and QAFP professionals manage client transitions and uphold confidentiality duties
The FP Canada Standards Council Conduct Review Panel (CRP) has provided practice guidance for Certified Financial Planner professionals and Qualified Associate Financial Planner professionals.
This guidance addresses the responsibilities of these professionals when ending a client/planner relationship, changing firms or employers, and referring clients to other professionals.
Its purpose is to ensure that CFP and QAFP professionals uphold their obligations under the FP Canada Standards Council Standards of Professional Responsibility, protecting the interests of clients in these scenarios.
The CRP, which includes CFP professionals and public members, developed this guidance following feedback from a recent survey.
In the survey, CFP and QAFP professionals expressed a need for more detailed explanations regarding their professional duties when withdrawing services and making referrals. In addition, the Standards Council has received public complaints related to these issues, prompting further clarification.
The guidance outlines situations that may lead to the termination of a planner-client relationship and details the planner's obligations in each instance. Among these are confidentiality obligations, with a clear reminder that the duty of confidentiality continues even after the client engagement has ended.
It also covers the essential duties related to referrals, including the rules governing conflicts of interest, referral fees, and other critical factors.
Jeff Cormier, CFP, and chair of the Conduct Review Panel, emphasized the importance of understanding these responsibilities.
“Over the course of a professional financial planner's career, it is common to have some turnover in the clients they serve, due to switching firms and other factors. It is also common for financial planners to refer clients to other professionals for advice in relevant areas,” Cormier stated.
He stressed that it is crucial for CFP and QAFP professionals to fully comprehend and adhere to all their professional obligations in these situations.
