Question #34
Reading: Reading 42.1 Standards of Professional Conduct Guidance for Standards I
PDF File: Reading 42.1 Standards of Professional Conduct Guidance for Standards I.pdf
Page: 14
Status: Incorrect
Correct Answer: B
Your Answer: A
Question
A CFA Institute member conscientiously maintains records of changes in security regulations. The member notices that his colleagues do not, and does NOT say anything. Is this a violation of Standard I(A)?
Answer Choices:
A. No, as long as the colleagues do not violate the new rules
B. Yes, and the member should disassociate from these colleagues
C. Yes, because the member is bound by the Code of Ethics
Explanation
The last bullet point of the Code says that a member shall "Maintain and improve their
professional competence and strive to maintain and improve the competence of other
investment professionals." Ignoring the neglect of rule changes of others would clearly be
incongruent with this component. As long as the colleagues do not violate the laws, the
member does not have to disassociate himself from the colleagues.
(Module 42.1, LOS 42: I(A))