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💵⚖️ FP Canada Standards Council™ Opens Consultations on New Proposed Rules of Conduct and Changes to Practice Standards Aimed at Protecting the Public

Thursday, 16 November 2023 04:23.PM

- Proposed changes support professional financial planners to continue to act in the best interests of their clients. -

The FP Canada Standards Council today opened consultations on two new Rules of Conduct for CERTIFIED FINANCIAL PLANNER® professionals and QUALIFIED ASSOCIATE FINANCIAL PLANNER™ professionals. One rule relates to professionals acting concurrently as estate trustees, executors or powers of attorney for property for financial planning clients who are not immediate family members; the second introduces a new requirement to identify a Trusted Contact Person.

"The Standards Council has seen an increase in cases that involve FP Canada certificants providing financial planning advice while concurrently acting as a power of attorney for property, executor/trustee or being designated as a beneficiary for their client," said Damienne Lebrun-Reid, Vice President of Standards, Certification and Enforcement at FP Canada™.

"These new proposed rules in the Standards of Professional Responsibility underscore our commitment to ensuring the best interests of clients, and by extension the public, are top of mind for the financial planning profession."

The Standards Council also announced consultations on updates to the Practice Standards following an earlier survey of QAFP® professionals, CFP® professionals, and industry compliance representatives regarding the clarity and relevance to practice of the standards.

Almost 900 responses were received and while most respondents felt the current Practice Standards were relevant and easily understood, feedback suggested they would benefit from guidance and clarification in some areas. In addition, the Standards Panel determined it was appropriate to add a new Practice Standard: "Monitor and Review."

New Rules of Conduct

Under the first new draft rule, a CFP professional or QAFP professional would be prohibited from accepting or acting as an estate trustee, executor, or as a power of attorney for property, and/or knowingly be named as a beneficiary for a client while continuing to provide financial planning advice or services to that client.

The second proposed rule would require CFP professionals and QAFP professionals to take reasonable steps to obtain the name and contact information of a Trusted Contact Person (TCP) for their client, as well as the client's consent for the planner to contact the TCP to confirm or make inquiries about any of the following:

• Concerns about possible financial exploitation of the client;
• Concerns about the client's mental capacity as it relates to the ability of the client to make decisions involving financial matters;
• The name and contact information of a legal representative of the client, if any; and
If the client cannot be reached, the client's current contact information.
• Updated and New Financial Planning Practice Standards
• The Practice Standards establish the level of practice expected of CFP professionals and QAFP professionals who are engaged in delivering financial planning services to clients. The • Practice Standards outline the process that must be followed in any client engagement where financial planning services are being offered, not just when delivering a comprehensive financial plan.

The Practice Standards subcommittee, struck by the Standards Panel, has updated the Practice Standards for currency and clarity, including additional examples and guidance, to ensure they remain clear, helpful and relevant to practice.

The new proposed "Monitor and Review" Practice Standard serves to remind CFP professionals and QAFP professionals that if the financial planning engagement includes ongoing monitoring, reviews should be held on a regular basis and any revised assumptions and/or recommendations resulting from these reviews should be documented and incorporated in an updated financial plan.

Next steps

The consultation period on both the new Rules of Conduct and the Practice Standards is underway and will continue until December 5, 2023.

Established in 1995, FP Canada is a national not-for-profit education, certification and professional oversight organization working in the public interest. FP Canada is dedicated to championing better financial wellness for all Canadians by leading the advancement of professional financial planning in Canada.


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