Ethical And Professional Standards - Ethical And Professional Standards Section 1
- Option : C
- Explanation : Standard I(B) Independence and Objectivity involves members and candidates not accepting any gifts or benefits that could be expected to compromise their independence and objectivity. Since no benefits were received Grosky has least likely violated I(B). Grosky most likely violated the Standards I(C) Misrepresentation, and I(D) Misconduct because she knowingly misrepresents the cause of the error.
- Option : B
- Explanation : Westlink and Lee’s current clients need to be informed along with the prospective clients, of the change in the fund’s mandate since they might have objections concerning the Fund’s new allocations. Hence Standard V(B) Communications with Clients and Prospective Clients is most likely violated. Significant risks and limitations of the new investments should also be disclosed along with their impact on the fund as a whole.
- Option : B
- Explanation : A is incorrect because Shekar was trying to artificially boost the price of the GYI’s stock in order to sell her holdings. C is incorrect because there is no basis for her statements in social media sites. Refer to Standard II(A) Material Nonpublic Information, Standard II(B) Market Manipulation, and Standard V(A) Diligence and Reasonable Basis.
- Option : A
- Explanation : Nader did not violate any Standard. There are always rumors in the market, before an official release by the company. Unless Nader knew that Sandler was in a business relationship with the merger companies, there was no reason to suspect that he was receiving nonpublic material information.
- Option : A
- Explanation : Agnimukha has violated Standard VII(A) Conduct as Participants in the CFA Institute Programs by sharing exam content, undermining the validity and integrity of the exam and CFA Institute Programs.
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