A CFA candidate was responsible for developing presentations regarding New Visio

Question

A CFA candidate was responsible for developing presentations regarding New
Vision Asset Managers’ investment process and historical investment
performance. When the Candidate moved to another firm, he brought with him
the presentation he developed for New Vision, changed the name of the company
and presented it to a client of his new employer. The client asked the candidate if
he had New Vision’s permission to use their presentation. The candidate
responded, “I created the presentation in my last month working there. It was,
after my resignation, so it’s mine to use. Besides the investment performance is
what I achieved for my clients at New Vision.” According to the Standards of
Practice Handbook, the CFA Candidate is least likely to have violated the CFA
Institute Standards of Professional Conduct that relate to:

A. Loyalty.
B. Misrepresentation.
C. Communication with Clients and Prospective Clients.

Explanation / Answer

It is not evident that the candidate did not disclose the basic format and general

principles of the investment processes, use reasonable judgment in identifying

which factors are import to their investment recommendations or distinguish

between fact and opinion. However, it is evident that the candidate did violate

Standard IV(A)-Duties to Employers, Loyalty as the candidate did not act for the

benefit of either his former or current employer since the candidate could

perceivably have caused harm to both by removing an asset from his former

employer and using it at his new employer, which reflects badly on the new

employer. In addition, the candidate implied that the performance at New Vision

was the performance of his new employer, which is a misrepresentation (Standard

I(C)- Professionalism, Misrepresentation) of his new employer’s historical

investment performance

C is correct

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