VII(A) Conduct as Participants in CFA Institute Programs
（1）Sharing Exam Questions
- Travis Nero serves as a proctor for the administration of the CFA examination in his city. In the course of his service, he reviews a copy of the Level II exam on the evening prior to the exam’s administration and provides information concerning the exam questions to two candidates who use it to prepare for the exam.
Comment:
- Nero and the two candidates have violated Standard VII(A).
- By giving information about the exam questions to two candidates, Nero provided an unfair advantage to the two candidates and undermined the integrity and validity of the Level II exam as an accurate measure of the knowledge, skills, and abilities necessary to earn the right to use the CFA designation.
- By accepting the information, the candidates also compromised the integrity and validity of the Level II exam and undermined the ethical framework that is a key part of the designation.
（2）Bringing Written Material into Exam Room
Loren Sullivan is enrolled to take the Level II CFA examination. He has been having difficulty remembering a particular formula, so prior to entering the exam room, he writes the formula on the palm（手掌; 棕榈树; 棕榈; 手心） of his hand. During the afternoon section of the exam, a proctor notices Sullivan looking at the palm of his hand. She asks to see his hand and finds the formula.
Comment:
- Because Sullivan wrote down information from the Candidate Body of Knowledge (CBOK) and took that written information into the exam room, his conduct compromised the validity of his exam performance and violated Standard VII(A).
- Sullivan’s conduct was also in direct contradiction with the rules and regulations of the CFA Program, the Candidate Pledge, and the CFA Institute Code and Standards.
（3）Writing after Exam Period End
At the conclusion of the morning section of the Level I CFA examination, the proctors announce, “Stop writing now”. John Davis has not completed the exam, so he continues to randomly fill in ovals on his answer sheet. A proctor approaches Davis’s desk and reminds him that he should stop writing immediately. Davis, however, continues to complete the answer sheet. After the proctor asks him to stop writing two additional times, Davis finally puts down his pencil.
Comment:
- oval：[ˈoʊvl]
- n. 椭圆形; 卵形; 澳大利亚式橄榄球球场
- adj. 椭圆形的; 卵形的;
- By continuing to complete his exam after time was called, Davis has violated Standard VII(A). By continuing to write, Davis took an unfair advantage over other candidates, and his conduct compromised the validity of his exam performance.
- Additionally, by not heeding the proctor’s repeated instructions, Davis violated the rules and regulations of the CFA Program.
- oval：[ˈoʊvl]
After completing Level II of the CFA exam, Annabelle Rossi posts on her blog about her experience. She posts the following: “Level II is complete! I think I did fairly well on the exam. It was really difficult, but fair. I think I did especially well on the derivatives questions. And there were tons of them! I think I counted 18! The ethics questions were really hard. I’m glad I spent so much time on the Code and Standards. I was surprised to see there were no questions at all about IPO allocations. I expected there to be a couple. Well, off to celebrate getting through it. See you tonight?”
- Comment:
- Rossi did not violate Standard VII(A) when she wrote about how difficult she found the exam or how well she thinks she may have done.
- By revealing portions of the CBOK covered on the exam and areas not covered, however, she did violate Standard VII(A) and the Candidate Pledge.
- Depending on the time frame in which the comments were posted, Rossi not only may have assisted future candidates but also may have provided an unfair advantage to candidates yet to sit for the same exam, thereby undermining the integrity and validity of the Level II exam.
- Level I candidate Etienne Gagne has been a frequent visitor to an internet forum designed specifically for CFA Program candidates. The week after completing the Level I examination, Gagne and several others begin a discussion thread on the forum about the most challenging questions and attempt to determine the correct answers.
- Comment:
- thread：
- n. 螺纹; (棉、毛、丝等的)线; 线索; 思路; 衣服; 脉络; 线状物; 思绪; 贯穿的主线; 细细的一条; 系列相关信息，链式消息
- v. 通过; 穿过; 穿(针); 给…装入; 穿行; 串在一起; 纫(针); 用…线缝; 穿成串;
- Gagne has violated Standard VII(A) by providing and soliciting confidential exam information, which compromises the integrity of the exam process and violates the Candidate Pledge.
- In trying to determine correct answers to specific questions, the group’s discussion included questionspecific details considered to be confidential to the CFA Program.
- thread：
- CFA4Sure is a company that produces test-preparation materials for CFA Program candidates. Many candidates register for and use the company’s products. The day after the CFA examination, CFA4Sure sends an e-mail to all its customers asking them to share with the company the hardest questions from the exam so that CFA4Sure can better prepare its customers for the next exam administration. Marisol Pena e-mails a summary of the questions she found most difficult on the exam.
Comment:
- Pena has violated Standard VII(A) by disclosing a portion of the exam questions. The information provided is considered confidential until publicly released by CFA Institute.
- CFA4Sure is likely to use such feedback to refine its review materials for future candidates. Pena’s sharing of the specific questions undermines the integrity of the exam while potentially making the exam easier for future candidates.
- If the CFA4Sure employees who participated in the solicitation of confidential CFA Program information are CFA Institute members or candidates, they also have violated Standard VII(A).
（5）Discussion of Exam Grading Guidelines and Results
Prior to participating in grading CFA examinations, Wesley Whitcomb is required to sign a CFA Institute Grader Agreement. As part of the Grader Agreement, Whitcomb agrees not to reveal or discuss the exam materials with anyone except CFA Institute staff or other graders. Several weeks after the conclusion of the CFA exam grading, Whitcomb tells several colleagues who are candidates in the CFA Program which question he graded. He also discusses the guideline answer and adds that few candidates scored well on the question.
Comment:
【IMP】Jose Ramirez is an investor-relations consultant for several small companies that are seeking greater exposure to investors. He is also the program chair for the CFA Institute society in the city where he works. Ramirez schedules only companies that are his clients to make presentations to the society and excludes other companies.
- Comment:
- Ramirez, by using his volunteer position at CFA Institute to benefit himself and his clients, compromises the reputation and integrity of CFA Institute and thus violates Standard VII(A).
- Marguerite Warrenski is a member of the CFA Institute GIPS Executive Committee, which oversees the creation, implementation, and revision of the GIPS standards. As a member of the Executive Committee, she has advance knowledge of confidential information regarding the GIPS standards, including any new or revised standards the committee is considering. She tells her clients that her Executive Committee membership will allow her to better assist her clients in keeping up with changes to the Standards and facilitating their compliance with the changes.
Comment:
- Warrenski is using her association with the GIPS Executive Committee to promote her firm’s services to clients and potential clients.
- In defining her volunteer position at CFA Institute as a strategic business advantage over competing firms and implying to clients that she would use confidential information to further their interests, Warrenski is compromising the reputation and integrity of CFA Institute and thus violating Standard VII(A).
- She may factually state her involvement with the Executive Committee but cannot infer any special advantage to her clients from such participation.
VII(B) Reference to CFA Institute, the CFA Designation, and the CFA Program
（1）Passing Exams in Consecutive Years
An advertisement for AZ Investment Advisors states that all the firm’s principals are CFA charterholders and all passed the three examinations on their first attempt. The advertisement prominently links this fact to the notion that AZ’s mutual funds have achieved superior performance.
Comment:
- AZ may state that all principals passed the three examinations on the first try as long as this statement is true, but it must not be linked to performance or imply superior ability.
- Implying that CFA charterholders achieve better investment results and those who pass the exams on the first try may be more successful than those who do not violates Standard VII(B).
（2）Right to Use CFA Designation
Five years after receiving his CFA charter, Louis Vasseur resigns his position as an investment analyst and spends the next two years traveling abroad. Because he is not actively engaged in the investment profession, he does not file a completed Professional Conduct Statement with CFA Institute and does not pay his CFA Institute membership dues. At the conclusion of his travels, Vasseur becomes a self-employed analyst accepting assignments as an independent contractor. Without reinstating his CFA Institute membership by filing his Professional Conduct Statement and paying his dues, he prints business cards that display “CFA” after his name.
Comment:
- reinstate：使恢复原状; 使恢复原职; 把…放回原处; 使重返岗位
- Vasseur has violated Standard VII(B) because his right to use the CFA designation was suspended when he failed to file his Professional Conduct Statement and stopped paying dues. Therefore, he no longer is able to state or imply that he is an active CFA charterholder.
- When Vasseur files his Professional Conduct Statement, resumes paying CFA Institute dues to activate his membership, and completes the CFA Institute reinstatement procedures, he will be eligible to use the CFA designation.
（3）“Retired” CFA Institute Membership Status
After a 25-year career, James Simpson retires from his firm. Because he is not actively engaged in the investment profession, he does not file a completed Professional Conduct Statement with CFA Institute and does not pay his CFA Institute membership dues. Simpson designs a plain business card (without a corporate logo) to hand out to friends with his new contact details, and he continues to put “CFA” after his name.
Comment:
- Simpson has violated Standard VII(B). Because he failed to file his Professional Conduct Statement and ceased paying dues, his membership has been suspended and he has given up the right to use the CFA designation.
- CFA Institute has procedures, however, for reclassifying a member and charterholder as “retired” and reducing the annual dues. If he wants to obtain retired status, he needs to file the appropriate paperwork with CFA Institute. When Simpson receives his notification from CFA Institute that his membership has been reclassified as retired and he resumes paying reduced dues, his membership will be reactivated and his right to use the CFA designation will be reinstated.
（4）Stating Facts about CFA Designation and Program
Rhonda Reese has been a CFA charterholder since 2000. In a conversation with a friend who is considering enrolling in the CFA Program, she states that she has learned a great deal from the CFA Program and that many firms require their employees to be CFA charterholders. She would recommend the CFA Program to anyone pursuing a career in investment management.
Comment:
Tatiana Prittima has earned both her CFA designation and a PhD in finance. She would like to cite both her accomplishments on her business card but is unsure of the proper method for doing so.
Comment:
Barry Glass is the lead quantitative analyst at CityCenter Hedge Fund. Glass is responsible for the development, maintenance, and enhancement of the proprietary models the fund uses to manage its investors’ assets. Glass reads several high-level mathematical publications and blogs to stay informed on current developments.
- One blog, run by Expert CFA, presents some intriguing（有趣的; 引人入胜的; 神秘的） research that may benefit one of CityCenter’s current models. Glass is under pressure from firm executives to improve the model’s predictive abilities, and he incorporates the factors discussed in the online research. The updated output recommends several new investments to the fund’s portfolio managers.
- Comment:
- “Expert CFA” has violated Standard VII(B) by using the CFA designation inappropriately.
- As with any research report, authorship of online comments must include the charterholder’s full name along with any reference to the CFA designation.
- See also Standard V(A), which Glass has violated for guidance on diligence and reasonable basis.
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