The Investment Advisor Body of Knowledge + Test Bank. IMCA

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      Procedures for Compliance

      Consultants shall advise clients of the privacy policy that applies to their relationship and assure them that all information gathered is of a strictly confidential nature. In addition, the compliance officer at the consultant's firm shall be notified of Standard 2d and the consultant's code of confidentiality.

      All client records and information relating to financial situations and goals shall be kept private and confidential by the consultant. Even the disclosure of a client's name without obtaining prior permission from the client is prohibited. The use of client lists that may influence a potential client's decision relative to a consultant's capability is discouraged.

      If professional references are requested by new or potential clients, consultants must obtain approval from existing clients in similar industries and situations prior to disclosing the names of these clients.

      On no occasion shall the consultant disclose the financial status, goals, structure, or other information relating to any client to any other person or body unless legally required to do so. While certain situations may have similar structures and resolutions, any disclosure of a client's situation disenfranchises the privacy of the client/consultant relationship.

      Regarding public funds, consultants may provide, if requested, information that exists in the public domain regarding public fund clients.

      Impact of the Standard

      Adherence to this standard improves the disclosure of information between the consultant and client and heightens the professionalism of the relationship.

      STANDARD 2E – A CONSULTANT'S RESPONSIBILITY TO MAINTAIN COMPETENCE

      Consultants have a responsibility to maintain competence through the highest ethical, professional, and ongoing educational practices within their means.

      Explanation

      The ability to render advice in a knowledgeable, professional, candid, and objective fashion is a basic requirement for establishing client trust. In order to have confidence in the advice being rendered, the client must have reason to fully trust the consultant's competencies and capabilities.

      Procedures for Compliance

      Consultants shall advise clients, partners, and their firms of their commitment to upholding professionalism through compliance with this standard.

      Impact of the Standard

      By adhering to this standard, the consultant assures clients that their consulting needs will be met competently and professionally.

      Standard 3: Responsibilities to the Public

      STANDARD 3A – A CONSULTANT'S RESPONSIBILITY TO ABSTAIN FROM USE OF MATERIAL NONPUBLIC INFORMATION

      Consultants who receive material nonpublic information in confidence have a responsibility to abstain from disclosure or use of that information, whether or not such use would cause harm to a client.

      Explanation

      By nature of their profession, consultants hold a unique position of trust and are bound by rules of professional confidentiality. Unless required by law, they may not disclose private information revealed by reason of that profession or position.

      Procedures for Compliance

      Consultants shall not disclose any confidential client information without the specific consent of the client unless in response to proper legal or regulatory processes. The use of client information for personal benefit is improper, even if it does not cause harm to the client.

      Consultants who possess material nonpublic information related to the value of a security shall not trade or cause others to trade in that security if such trading would breach a duty or if the information was misappropriated or relates to a tender offer. If material nonpublic information is disclosed in breach of a duty, the consultant shall make all reasonable efforts to achieve public dissemination of such information.

      Impact of the Standard

      Adherence to this standard enhances the reputation of consultants, both professionally and personally, and helps to ensure that CIMA^® and CIMC^® certificants and IMCA members are recognized as maintaining the highest standards of conduct.

      STANDARD 3B – A CONSULTANT'S RESPONSIBILITY TO MAKE PROPER USE OF CERTIFIED INVESTMENT MANAGEMENT ANALYST^® AND CERTIFIED INVESTMENT MANAGEMENT CONSULTANT^® CERTIFICATIONS

      Consultants have a responsibility to ensure that the CIMA and CIMC certifications are used only by those who meet IMCA requirements. Specifications for proper use of the certifications have been established by IMCA.

      Explanation

      The CIMA and CIMC certifications are intended to enhance public awareness of the investment management consulting profession and reflect the high standards set by IMCA. To protect the status of these certifications, their use has been regulated by IMCA, and CIMA and CIMC licensees are to use these certifications only in ways approved by IMCA.

      Procedures for Compliance

      Only those individuals who meet IMCA requirements may use the CIMA or CIMC marks. These individuals are encouraged to use these references, but only in a proper, dignified, and judicious manner.

      Qualified individuals may use the proper references verbally, in print, in advertisements, on business cards, on letterhead, and in marketing brochures. CIMA and CIMC licensees must obtain authorization as required from their firm's compliance department for use of the certification on business cards, letterhead, and other printed forms. When using the CIMA or CIMC logo or certification in printed materials, only IMCA-approved artwork, fonts, and positioning may be used, as specified in the Guide to Use of the IMCA Marks. Neither reference may be used as any part of a business name. The certification may not be used in any form that does not comply with current IMCA guidelines without the express written approval of IMCA prior to any such use.

      The use of either reference may be accompanied by an explanation of the requirements that have been met in order to earn the CIMA or CIMC certification. Any explanation of the certification must be quoted directly in the approved form and language as outlined in the Guide to Use of the IMCA Marks.

      Continued use of the CIMA or CIMC certification is dependent upon meeting continuing education requirements, as determined by IMCA, as well as strict adherence to the IMCA Standards of Practice and IMCA Code of Professional Responsibility.

      Impact of the Standard

      As the public's understanding of investment management consulting is broadened, adherence to this standard and standardized usage of the CIMA and CIMC certifications enhance recognition of CIMA and CIMC certifications as representing the highest standard in investment consulting expertise.

      STANDARD 3C – A CONSULTANT'S RESPONSIBILITY TO BE FAIR AND ACCURATE IN ADVERTISING AND COMMUNICATIONS

      It is the responsibility of the consultant to act with integrity, dignity, and honesty and to maintain the highest standards of ethics in all forms of communication.

      Explanation

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