Ethical and Professional Standards Q109

0. Shiraz Ahmed is a trader at an investment management firm. He is also involved in the buy-side trades of an aggressive equity fund managed by the firm. During a recent decline in the market many securities of the aggressive equity fund show a marked decline in value, but the performance of the fund does not show a change in return. Ahmed at once mentions it to his supervisor and the compliance officer, who tell him that the fund is doing well and he should concentrate on his job at the trading desk instead of asking irrelevant questions. The CFA Institute Standard that is least likely violated is:

Answer
Comment
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Option : C
Explanation : According to Standard IV(C) Responsibilities of Supervisors, the supervisor and the compliance officer have the responsibility to investigate Ahmed’s concerns. Also see Standard I(D) Misconduct.

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