Question 1 - #23482
Hunter Harrison, CFA, is president and chief investment officer of Ironclad Investments, an investment adviser
and pension consultant for medium and large corporate pension clients. Ironclad recently hired a compliance
officer to update its compliance manual, which follows the CFA Institute Code and Standards. Harrison serves
as a director on several non-profit and corporate boards of directors, some of which have their pension assets
managed by Ironclad. Harrison oversees Ironclad’s research analysts and portfolio managers, including
Michelle Myers, who recently completed Level II of the CFA examination last year. Myers is a portfolio
manager who regularly meets with clients and prospects. Myers also is a partner in a software company that
sells retirement and benefit administration services to institutional clients, some of which are also clients of
Ironclad. During her correspondence with prospects and clients, Myers commonly refers to her status as a
candidate in the CFA program. She has included reference to her status as a “Level III CFA candidate” in her
biographical background to increase her prominence in the industry.
Part 1)
During her correspondence with prospects and clients, Myers commonly refers to her status as a candidate in
the CFA program. She has included reference to her status as a “Level III CFA candidate” in her biographical
background to increase her prominence in the industry. What Standard governs the actions of Myers and is
she in compliance?
Your answer: A was incorrect. The correct answer was B) Standard VII: Responsibilities as a CFA Member or
CFA Candidate. Compliance: Yes.
The actions of Myers are covered under Standard (VII): Responsibilities as a CFA Member or CFA
Candidate and Myers appears to be in compliance with the Standard. Standard VII(B): Reference to CFA
Institute, the CFA Designation, and the CFA Program requires that CFA candidates appropriately reference
their participation in the CFA program, clearly stating their candidate status and not implying the achievement
of any type of partial designation. Additionally, to be considered a candidate an individual must be registered
to take the next scheduled exam. Since Myers completed Level II last year, and no information is provided to
indicate that she is not registered for the next examination, she appears to be a candidate.
Part 2)
All of the following most likely apply to Myers’ participation as a partner in the software company EXCEPT:
Your answer: A was incorrect. The correct answer was D) Standard IV (B.4): Priority of Transactions.
Standard VI(B): Priority of Transactions most likely does not apply to Myers’ participation in the software
company. Standard VI(B) covers priority over transactions in securities or other investments for clients and
employers to prevent any instances of “front-running” for the benefit of the member. Myers’ software business
is not transaction oriented, and there is no information that describes any instances of the software company
having priority in securities transactions over Ironclad or its clients.
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A) Standard III: Duties to Clients. Compliance: No.
B) Standard VII: Responsibilities as a CFA Member or CFA Candidate. Compliance: Yes.
C) Standard IV: Duties to Employer. Compliance: No.
D) Standard I: Professionalism. Compliance: No.