CFP Certified Financial Planner

Under the CFP Board's Standards of Conduct, a CFP professional must act as a fiduciary when providing which of the following?

• AOnly investment advice
• BOnly financial planning services
• CFinancial advice that covers financial planning, including all material terms of an engag…
• DAll financial advice, at all times when providing Financial Advice

A CFP professional discovers that a client has been engaging in money laundering. Under the CFP Board's Code of Ethics, what is the CFP professional's primary obligation?

• AContinue providing services while documenting concerns privately
• BReport the activity to the CFP Board and consider reporting to appropriate authorities
• CImmediately terminate the relationship without any further communication
• DConfront the client and give them an opportunity to stop the behavior before taking action

Which of the following best describes the CFP Board's Duty of Loyalty?

• AThe CFP professional must always recommend the lowest-cost product available
• BThe CFP professional must place the interests of the client above the interests of the CF…
• CThe CFP professional must never receive commissions from product sales
• DThe CFP professional must provide identical recommendations to all clients with similar n…

A CFP professional receives a complaint from a client alleging negligence. Under the CFP Board's disciplinary process, what is the first step after the complaint is filed?

• AThe CFP professional's certification is immediately suspended pending investigation
• BThe CFP Board's Disciplinary and Ethics Commission conducts a formal hearing
• CCFP Board staff conducts a preliminary investigation to determine if a potential violatio…
• DThe complaint is forwarded directly to FINRA for review

Which of the following scenarios would most likely constitute a conflict of interest that a CFP professional must disclose to a client?

• AThe CFP professional recommends a diversified portfolio of low-cost index funds
• BThe CFP professional's firm receives 12b-1 fees from a mutual fund family that the profes…
• CThe CFP professional charges an hourly fee for financial planning services
• DThe CFP professional refers the client to an independent CPA for tax preparation

The CFP Board's Practice Standards require a CFP professional to do which of the following before making recommendations?

• AObtain the client's written agreement to implement all recommendations
• BAnalyze the client's current financial situation and identify goals
• CGuarantee a specific rate of return on the recommended investments
• DPrepare a formal financial plan document of at least 50 pages

A CFP professional is compensated through a combination of fees and commissions. Under the Standards of Conduct, what must the professional disclose regarding this compensation structure?

• AOnly the fee portion since commissions are standard industry practice
• BOnly the commission portion since fees are agreed upon by the client
• CAll material conflicts of interest, including how the compensation structure could affect…
• DNothing, as long as the total compensation is reasonable for the services provided

The CFP Board can impose which of the following sanctions on a CFP professional found to have violated the Standards of Conduct?

• ACriminal prosecution and imprisonment
• BMonetary fines payable to the harmed client
• CPrivate censure, public censure, suspension, or permanent revocation of certification
• DSuspension of the professional's securities license through FINRA

A CFP professional has a client who is elderly and shows signs of diminished cognitive capacity. The client insists on transferring a large portion of their assets to a new acquaintance. What should the CFP professional do?

• AExecute the transfer as requested since the client has the right to make their own decisi…
• BRefuse to process the request and report the client to Adult Protective Services without…
• CDiscuss concerns with the client, consider contacting a previously identified trusted con…
• DDelay the transaction indefinitely until the client changes their mind

Under the CFP Board's Duty of Care, a CFP professional must do which of the following?

• AAct with the care, skill, prudence, and diligence that a prudent professional would exerc…
• BGuarantee that all recommendations will result in positive outcomes for the client
• COnly recommend products from the firm's approved product list
• DProvide the same level of service to all clients regardless of the complexity of their si…

Which of the following activities would require a CFP professional to provide a written engagement letter under the Standards of Conduct?

• AProviding a one-time recommendation to purchase a specific stock
• BProviding Financial Advice that requires financial planning
• CAnswering a client's general question about market conditions
• DReferring a client to another professional for tax advice