Qbank/ EOC - Ethic

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FrankCFA

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1. Jack was an intern in ABC. After finishing the intern, Jack starts to interview with a number of firms, and tells each one about the accounts that he is managing and expects to be able to bring with him. Because he was merely an intern at ABC, he does not think he owes any particular loyalty to ABC. He gains further assurance that he can keep the clients from the fact that his former supervisor implied that these were Jack’s clients.

Q1:
Does Jack comply with the CFA Institute Standards of Professional Conduct when he asks his clients to transfer their accounts to the new firm?

A. No.
B. Yes, because he contacted the clients after leaving ABC.
C. Yes, because he was an intern and not a paid employee of ABC.



2. Jack says “although a firm cannot adopt the CFA Institute Code of Ethics and Standards of Professional Conduct, the firm can adopt the CFA Institute Asset Manager Code of Professional Conduct”.

Q2: Is Jack’s statement with respect to adoption of the CFA Institute Code of Ethics and Standards of Professional Conduct and the CFA Institute Asset Manager Code of Professional Conduct, respectively, correct?

A. Yes; Yes
B. No; Yes
C. Yes; No
 
This was an extract from the Dead Sea Scrolls. Muslim, Christian, Jewish and few Mormon scholars joined forces to study this script. They failed. It was too challenging. The four scholars converted to Scientology
 
Correct.
B is correct. Standard IV(A) prohibits employees from soliciting the clients of employers prior to, but not subsequent to, their departure. (*But I think this questtion is not well written. If he used prior company’s information which is not public to solict the former client, it still violates the standard)

B is correct. The CFA Code and Standards apply to individual members and candidates of CFA Institute, but firms are encouraged to adopt the Code and Standards as part of their firm code of ethics. The CFA Institute Asset Manager Code of Professional Conduct has been drafted specifically for firms.
 
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