Financial planners who want to stay in good standing with the Certified Financial Planner Board of Standards Inc. better be careful about conducting professional activities outside of their advisory practices.
In its
latest list of disciplinary actions, the CFP Board cited outside business activities as one of the reasons for taking action in three of the 10 cases.
Punishments for the 10 cases included one revocation and one administrative revocation of the CFP mark, two suspensions and six letters of admonition.
Aaron R. Parthemer of Ft. Lauderdale, Fla., lost his CFP mark for participating in outside business activities and failing to notify his firm. He also loaned nearly $400,000 to three clients and conducted eight private securities transactions with clients without disclosing them to his firm, according to the CFP Board.
Once a financial adviser for professional athletes, Mr. Parthemer also
allegedly ran a Miami nightclub. He falsified filing with the
Financial Industry Regulatory Authority Inc., the broker-dealer self-regulator, which barred him from the securities industry. The CFP Board took away his designation as of Jan. 4.
An email response from an attorney who had represented Mr. Parthemer did not include comment on his client.
D. Robin Walker of Verona, Miss., had his CFP mark suspended for a year after he established a registered investment advisory practice separately from the advisory firm where he worked in order to utilize a proprietary trading model for exchange-traded funds, according to the CFP Board.
Mr. Walker did not disclose the RIA to his firm, and the CFP Board found that he violated the fiduciary duty to his clients when he failed to tell them about the RIA's ownership arrangements. He was fined $60,000 by the Securities and Exchange Commission and $20,000 by Finra, which also suspended him for 20 months.
Mr. Walker could not be reached for comment.
Deborah S. Giffin of McMurray, Pa., received a letter of admonition from the CFP Board for selling insurance and collecting commissions without obtaining permission or disclosing the activity to her firm.
Ms. Giffin was not immediately available for comment.
Bankruptcies also tripped up several CFP holders.
Alan L. Mitchell of Decatur, Ga., lost his CFP mark after he failed to respond to a CFP Board complaint regarding bankruptcies in 1996 and 2013. The CFP Board said the filings “reflected adversely on Mr. Mitchell's integrity and fitness as a CFP professional, upon the CFP marks and upon the
financial planning profession.”
Mr. Mitchell declined to comment.
James P. O'Mara of York, Pa., received a 90-day suspension of the use of the CFP mark for failing to mention a bankruptcy on his Finra registration and for not disclosing it to his firm. The CFP Board also said Mr. O'Mara falsely held himself out as a certified public accountant.
Mr. O'Mara declined to comment.
Harold S. Kern of San Jose, Calif., was admonished by the CFP Board for filing bankruptcies in 1995 and 2015.
Mr. Kern could not be reached for comment.
Another CFP was disciplined for inappropriate investment advice. Gary L. Barker was admonished for recommending a real estate private placement fund to an elderly client.
Mr. Barker did not respond to a request for comment.
Other CFPs were disciplined for providing planning services without disclosing them to their firm, taking a loan from a client and committing alcohol-related misdemeanors.
