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Is the CFP-BOD, and the CFP® mark, in Jeopardy? [VOTE]

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Early CFP® Board Leader Says Future of Certification in Jeopardy

[By Staff Reporters]

The CFP® Board’s strategy of punishing some certificate holders over compensation disclosure issues in what critics charge is an arbitrary manner threatens the future of the CFP® designation, according to one of the early leaders of the board who also chaired its disciplinary commission.

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And so, we ask this question.


Link: http://www.financial-planning.com/news/early-cfp-board-leader-says-future-of-certification-in-jeopardy-2686698-1.html?ET=financialplanning:e14975:86235a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=FP_Weekend__092713

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43 Responses

  1. The Poll,

    The CFP-BOD is like the emperor without clothes.
    And, the “mark to use a mark” is ludicrous.

    The internet’s transparency is finally bringing down all the pompous salesmen.



  2. A non-issue

    This is not really the correct question.
    The real issue is simply this: Does anyone know what CFP means?
    And by extension, is it meaningful to clients as something beside a marketing artifice? Other than CFP mark holders, of course.

    For example, I was in traffic court recently for a minor violation which I contested. The judge asked me what I did for a living. CFP was the reply. He then asked; what’s that? And, this was after the $5-M marketing campaign last summer.

    So, when you ask if the BOD and CFP mark will survive?
    I reply – does it really matter?




  3. Who to Trust?

    You’ve decided it’s time to engage a financial planner, but you don’t know any financial planners. How do you know whom to trust?

    For years I have recommended that you start by finding a professional with the CFP® designation. It’s become recognized internationally as the standard for financial planning. The CFP® designation is conferred in the United States by the CFP® Board and by 22 other organizations affiliated with them.

    To earn the CFP® designation, one must hold a bachelor’s degree, pass six semester courses on a broad spectrum of financial topics, pass a 10-hour exam, and complete three years of experience. To keep it, designees must pay the CFP® Board an annual fee of $325, complete 30 hours of continuing education every two years, and abide by a code of ethics. The cornerstone of the code of ethics is the duty to act as a fiduciary, or in the consumer’s best interest.

    Within that code of ethics, CFP®s may be compensated for their work in three ways: commissions, fees (fee-only), and both fees and commissions (fee-based). The duty to act as a fiduciary is difficult to carry out when a majority of the compensation comes from selling the consumer a product. In fact, many other countries, like Australia and the UK, do not allow individuals who give financial advice to also sell products and receive commissions.

    Still, I know many excellent “fee and commission” CFP®s who do put their client’s interests first. Typically, only a small portion of their compensation comes from commissions. Some of them sell their clients term life insurance, which has a low commission, instead of sending them to a life insurance salesperson who may be tempted to upsell them more expensive and commission-laden products.

    Other planners establish a set annual fee and offset any commissions received against the fee. If you’re shopping for a fiduciary planner, it’s hard to know without doing an extensive interview if a “fee-based” planner’s compensation is largely fees or largely commission.

    For these reasons, when I became a CFP® in 1983 I decided to remove any potential conflict of interest and only accept fees for my financial planning services. Accordingly, I hold myself out as a “fee-only” planner. Over the years, “fee-only” has become the easiest way to be reasonably assured the financial planner is a true fiduciary.

    However, a number of CFP®s have found a way to misuse this term, rearranging their compensation so they can brand themselves as “fee-only” without giving up lucrative commissions. Usually, they do this by owning two firms. One is a “fee-only” firm that charges consumers fees for planning advice. The other is a financial services company that earns commissions by selling the client financial products. The CFP® can take a salary or receive dividends from the financial services firm and thereby contend that he or she does not receive commissions. Slick.

    Too slick. To stop this abuse, the CFP® Board recently passed a new requirement. It specifies that if CFP®s, or any party related to them, own any interest in a financial services company, they cannot call themselves fee-only.

    On the surface, this would appear to solve the problem and make it easier for potential clients to find planners who are true fiduciaries. The problem is, like all regulations, there are unintended consequences.

    Those consequences have snared me, along with several other fee-only planners who are careful to carry out their fiduciary duty to clients. In order to maintain my professional integrity, I’m even considering giving up the CFP® designation I have maintained with pride for 30 years. Next week I’ll tell you why.

    Rick Kahler CFP®


  4. Retail Sales

    If not in the back-office, then 99% of the financial advisory business is retail sales; period!



  5. CFP® Board Defends Fee-Only Definition

    The CFP® Board of Standards is sticking by its guns in the controversy over the definition of what constitutes a fee-only advisor.


    In the latest round in the continuing controversy over the definition of fee-only by the CFP Board of Standards, the organization’s CEO sent an e-mail to 69,000 CFP® professionals sticking by its existing fee-only definition.

    So, hey-hey; ho-ho; Kevin R. Keller and the Board has got to go.

    Stewart CFP®


  6. Financial Advisors Aren’t Doctors
    [Read what next-generation doctors really think of FAs]

    Well all know that Financial Advisors [FAS] like to compare themselves to CPAs, attorneys, physicians and other professionals who spend years in training and pass difficult tests to get advanced degrees and certifications.

    Most advisors, if they took a test at all, took one that required little training and even less experience. Yet they still use lines such as “You wouldn’t let just anyone operate on you, would you?” or “I’m like your family physician for your finances. I might send you to a specialist for a few things, but I’m the one coordinating it all.”

    These lines are designed to make us feel good about trusting them with our hard-earned dollars and, more importantly, to think of personal finance and investing as something that “only a professional can do.”

    Unfortunately, believing those lines can cost you hundreds of thousands of dollars and years of retirement.


    Now medical colleagues, tell us what you really think?

    Ann Miller RN MHA


  7. FPA Opposing CFP Board Entry as CE Provider

    The CFP Board “cannot justifiably act as both a regulator for continuing education providers and as a CE provider themselves,” according to FPA president Michael Branham who reportedly spoke thusly at a general session of the association’s annual conference.


    What do you think. Shall we turn in our CFP marks?



  8. The CFP-BOD CEUs were a Joke Anyway!

    The FPA doesn’t want the CFP Board to become a continuing education provider.


    Years ago – my 5 year old daughter used to fill out the annual CFP requirements for me on IBM index bubble cards. Several years later, when she was 8 or 9, she got bored and rebelled saying the questions and answers never changed.

    Ditto for the CEU ethics requirements, as well as my state insurance license! After she quit; so did I.

    Then, I contacted my state insurance commissioner, and a neighbor. I was told to enjoy my “free ride”. So, I quit, yet again.

    Have things changes for the better or worse; since then?
    Please advise.

    Dr. David Edward Marcinko MBA
    Ann Miller RN MHA


  9. Fee-Only Questions Surface at FPA Conference

    According to this article, FPA Chairman Paul Auslander and former CFP Board Chairman Harold Evensky voice opinions on the fee-only controversy, which was heightened recently.


    And, the answer is not consumer education. It is OUR education.



  10. On the Future of the CFP® Mark

    As we say in the emergency room: D.O.A.

    Nurse Betty


  11. On financial designations

    Take another look at this related link:




  12. House Approves Bill to Delay DOL Fiduciary Rule

    A measure that would put the brakes on the Department of Labor’s proposal to establish a fiduciary standard for financial advisors to retirement plans was just approved by the US House of Representatives in a largely party-line vote.


    And, even more on the topic.




  13. CFP Board & Husband-and-Wife Planners Trade Jabs in Court

    A husband-and-wife planning firm and the CFP® Board have traded jabs in court over whether the planners can seek damages in their lawsuit against the board.


    Very professional; fighting over intangible definitions and a trade-mark; not malfeasance, philosophy, education, service or outreach.

    Dr. David Edward Marcinko FACFAS MBA CMP®


  14. Avoid the Problem – Become a Certified Medical Planner™

    That’s why the R&D efforts of our governing board of physician-directors, accountants, financial advisors, academics and health economists identified the need for integrated personal financial planning and medical practice management as an effective first step in the survival and wealth building life-cycle for physicians, nurses, healthcare executives, administrators and all medical professionals.

    Now – more than ever – desperate doctors of all ages are turning to knowledge able financial advisors and medical management consultants for help. Symbiotically too, generalist advisors are finding that the mutual need for extreme niche synergy is obvious.

    But, there was no established curriculum or educational program; no corpus of knowledge or codifying terms-of-art; no academic gravitas or fiduciary accountability; and certainly no identifying professional designation that demonstrated integrated subject matter expertise for the increasingly unique healthcare focused financial advisory niche … Until Now!

    Enter the Certified Medical Planner™ charter professional designation. Always a fiduciary! Always for the doctor client.

    Eugene Schmuckler PhD MBA CTS
    [Academic Dean of Adult-Learners]



  15. CFP Board Seems To Love Hostile Fire

    The CFP Board is giving no sign of backing down on several controversial issues, despite a barrage of hostile fire from the advisors it regulates.


    Don’t you think these intellectual property guys are just sharks looking out for themselves?



  16. Financial Planning Association to CFP Board of Standards
    [Continuing Education Foray Risks “Irreparable Damage”]

    As the standard-setting body for CFP™ professionals, the CFP Board has a critical role in shaping the financial planning profession.


    Along with the FPA, it has laid the foundation for the past 25 years for the recognition of financial planning and it has worked admirably in enforcing the standards for CFP™ professionals … but, the shitake mushrooms are now hitting the proverbial fan. And, it is my opinion the “CFP marks” are indeed in jeopardy. What do you all think?

    Thanks goodness I’m a Certified Medical Planner™ and fiduciary advisor.

    Dr. David Edward Marcinko MBA CMP™


  17. Core CFP-BOD beliefs

    Dr. Marcinko – At their core, these guys were insurance agents from the insurance industry, who appear to be bullies and thugs; nothing more. Of course, this is not real news for insiders.

    But, the public is finally learning the truth. I am so glad I am not a CFP; anymore. Pity the ever-faithful [duped] mark holders.



  18. More on the CFP-BOD Imbroglio

    By Mike Kitces MSFS, MTAX, CFP®, CLU, ChFC, RHU, REBC, CASL


    Any thoughts?

    Ann Miller RN MHA


  19. CFP Board Extends Ad Campaign for 2 Years

    In a business update to CFP holders, the board presents research on its Let’s Make a Plan campaign, clarifies its fee-only position — and naturally skips a discussion of recent controversy.


    Is anyone surprised?



  20. Hello,

    I’d rather saw my nut-sack off than get the CFP.



  21. CFP Board Upgrades CE Requirements

    Dr. Marcinko – Did you know that the CFP Board just announced plans to upgrade CFP continuing education standards, but declined to follow through on a controversial proposal to offer its own CE programs.




  22. Too Many Designation “MARKS”?

    Another way to view the financial services certification conundrum thru a plethora of designation marks, is to realize that according to WealthManagement.com’s 2013 survey Advisor Benchmarking RIA Trend Report, there was a percentage decline in all Series licensers, except the #6, with the #65 getting attention from half of those surveyed.

    The survey of 381 RIAs also fond that the number of those pursuing the CFP® marks was down to 36% in 2013; compared to 43% in 2011. Those seeking the CFA® charter were also down to 11 % this year, from 16% in 2011.

    So, why the designation fatigue? Most are low level and marginal.



  23. Take the Fiduciary Pledge
    [Is your financial adviser really working for you?]

    Your financial adviser may not be legally required to act in your financial best interest.


    And, here’s how to fix that:




  24. Judge Rules Against CFP Board in Camardas Lawsuit

    According to news reports, the stage may be set for a settlement after a judge denied the CFP board’s attempt to quash discovery & allows the Camardas’ request to seek monetary damages.


    Who are these CFP-BOD guys anyway … insurance agents? Yuk!



  25. Financial Planning Association to CFP Board of Standards

    If the “Continuing Education Foray Risks Irreparable Damage”; then the damage is self-inflicted from arrogance.



  26. Many Wirehouse CFPs Did Not Tell Clients They Weren’t Really Fee-Only

    Many wirehouse advisors had to change their compensation disclosure following an abrupt change last fall by the CFP Board.


    CFP Board Aims for 81,000 CFPs

    Yet, the board’s plans focus on aggressive growth, increased awareness of mark and regulatory impact.


    So, just keep those fees rolling into the BOD.



  27. CFP Board Reduces Length of CFP Exam From 10 Hours To A 6-Hour Single-Day Test


    And so Bradley, did the CFP Board just lower the standards of the exam and try to make it easier to grow the ranks of CFP certificants?

    Any thoughts?



  28. Is the CFP Board – or just Bored?

    According to Mike Kitces CFP, over the past year, a series of revelations about the CFP Board’s compensation disclosure requirements have significantly shifted the landscape in how CFP certificants must explain their compensation to prospective and current clients.

    While the CFP Board maintains that “nothing has changed” since the rules were formally enacted over 5 years ago, the fact that large numbers of advisors continued to find themselves out of compliance – with another potential shoe soon to drop – suggests that whether the organization admits it or not, the CFP Board has changed the rules of the game.


    Q: And so, Has The CFP Board Rendered Compensation Disclosure Meaningless For Consumers?

    A: It has for me; years ago.

    Dr. David Edward Marcinko MBA


  29. CFP Board Taps Ex-Regulatory Official for Disciplinary Panel

    As four officials begin terms as volunteer chairmen of CFP Board councils, a former panel chairman highlights the challenges they may face.




  30. Camardas Ask Court to Force CFP Board’s Hand

    According to Ann Marsh, almost two months after a court order, the CFP Board has failed to produce the required documents, Florida planners say.


    So, it is reasonable to ask: who is the Board fighting with; themselves or their certificants?

    End the CFP-BOD, now.



  31. CFP Mark

    Oh! How the mighty have fallen.



  32. Is the CFP Board Losing Credibility in the Eyes of Advisors?

    A WealthManagement.com survey shows one-third of advisors believe the recent scandals plaguing the board have hurt the value of the designation, while over half don’t trust the compensation disclosures on the firm’s website.


    Ann Miller RN MHA


  33. $600,000 Legal Tab in CFP Board Lawsuit?

    According to ANN MARSH, in a court filing, the CFP Board says it has logged more than 2,000 hours of legal work in a lawsuit by two Florida planners.


    The Board is a simply an intellectual property provider and protector, anyway, and so is their law firm.

    I guess they will have to now increase our membership, test, CEU and related fees. SHAMEFUL.



  34. Camardas Get CFP Board Documents, But Not Cash, in Latest Ruling

    Judge tells board to produce documents, denies Camardas their request for sanctions; CFP Board sends documents to plaintiffs.




  35. CFP Board Aiding NAPFA Members in Fee-Only Bind

    The board offered individual counsel to NAPFA members in violation of board rules, an ongoing conflict without imminent resolution?




  36. CFP Board Aims to Fix Its Fee-Only ‘Mistake’

    ‘We were not as proactive as we should have been,’ the CFP Board says, rolling out two initiatives aimed at resolving advisors’ incorrect fee-only disclosures on its website.


    Still Disgruntled


  37. CMP™ online certification program

    I will be looking into the Certified Medical Planner™ program as an alternate educational designation. Many thanks for the information.



  38. The Demise

    Personally, I think the organization is in a death spiral.

    Think about it: 69% of students who are interested in the field have walked away from the CFP as a designation. If I am wrong, and by some offhand chance they do grow, then the extra money will come in handy paying that CFP couple in Florida – and who knows how many other CFPs will join or continue to sue the CFP Board.

    Scott M


  39. Planner Threatens Suit After CFP Board Order

    According to Ann Marsh, after being ordered to stop calling his firm fee-only, Rick Kahler claims retribution and threatens a lawsuit.


    Mr. Kahler is a frequent contributor to this ME-P. Go Rick!

    Dr. David Edward Marcinko FACFAS MBA CMP™
    [A reformed former CFP®]


  40. Thanks, looks like 40% of your respondents are concerned!

    Rick Kahler CFP®

    Kahler Financial Group
    1010 9th Street, STE 1
    Rapid City, SD 57701
    605-343-1400 ext 111
    605-721-0194 (fax)


  41. Financial Planning Programs Struggle with Enrollment, CFP Completion

    According to Megan Leonhardt, the number of CFP Board-registered bachelor’s degree programs in financial planning are on the rise, but schools say student enrollment, retention and completion of the CFP exam are still major challenges.


    Say, bye-bye!



  42. CFP Board’s Reduced Experience Requirement Quietly Takes Effect With FPA And NAPFA Silence As Tacit Support?

    Last week the CFP Board quietly adopted changes to the work requirement for its certification, allowing three years of “indirect” work to fulfill the “financial planning experience” requirement. But Michael Kitces contends on his Nerd’s Eye View blog, the new, less rigorous requirement—which can include such roles as employee benefits administrators, compliance attorneys, and journalists reporting on financial planning topics—is problematic.

    It’s ironic, he says, that this change comes after the CFP Board has spent $40 million on a public awareness campaign advocating to the public that CFP certified advisors represent the “gold standard” in financial planning, even as the organization makes it easier and easier to obtain the mark.


    So, Is CFP Board’s Growth Coming at the Cost of Integrity?



  43. CFPs

    As a client or potential client, you may regard fee-only financial planners as professionals on a par with attorneys or CPA’s. Yet financial planning is still trying to become a profession.

    Several hallmarks distinguish a profession: prolonged or special training, a particular skill, a high level of education, and a formal qualification. By definition, professions are inherently separate from trades, industries, and businesses.

    The financial services industry, where financial planning currently resides, includes a broad spectrum of companies and individuals who sell a variety of products, provide various services, and offer financial advice. Many planners feel that financial planning, as it relates to giving financial advice, needs to be elevated to a profession. Academia has also begun to offer undergraduate, graduate, and doctoral degrees in financial planning.

    Professions such as medicine, law, and counseling require certifications from licensing boards before anyone can begin practicing. There is no such requirement for financial planners.

    The closest thing is a certification which is something less than a formal qualification. It is a formal procedure by which an authorized organization assesses and verifies the qualification of an individual’s skills in accordance with established requirements or standards. Of several certifications for financial planning, the most recognized is the Certified Financial Planner (CFP®) designation from Certified Financial Planner Board of Standards, Inc.

    As professional organizations grow and mature, they often tighten the requirements for membership and certification. This has been the case with major professions such as law, medicine, engineering, and mental health.

    In contrast, the CFP Board recently reduced four of the qualifications to earn the CFP® certification:

    1. In 2012 the Board modified its requirement for three years of financial planning experience to include a two-year apprenticeship option.

    2. In 2014 the comprehensive exam was reduced from two days to one, a move seen by many CFP® practitioners as the first step to make obtaining the certification easier.

    3. In June 2015 the Board eliminated the requirement for certain applicants to take a designated financial planning course before taking the CFP exam.

    4. In June 2015 they broadened the definition of “financial planning experience.” Required experience previously included teaching financial planning or delivering financial plans to clients. The new definition includes what the CFP Board describes as “activities and responsibilities reflecting financial planning knowledge and competencies that indirectly support the financial planner and/or the financial planning process.”

    As financial planner and writer Michael Kitces points out, under this definition “virtually any job in the entire financial services industry will now qualify as financial planning experience, including an employee benefits administrator, a compliance attorney, and even a journalist who simply writes about financial planning topics.”

    The watered-down requirements are hard to comprehend if the CFP Board’s intent is for the CFP® certification to be the mark of the financial planning professional. If the goal is to help financial planning develop as a profession, the organization might tend to tighten the educational and experience requirements, not ease them. Instead, it appears that the goal of the CFP Board is to broaden the CFP® as the mark of the financial services industry.

    The CFP Board has left it up to financial planners and academia to elevate financial planning to a profession. That will not happen anytime soon.

    Until a formal qualification for financial planners develops, the public would do well to understand that a CFP® certification is only a mark of education. It does not guarantee that someone has financial planning experience, is competent, or has a fiduciary duty to the consumer. Potential clients still need to verify a CFP®’s qualifications the old-fashioned way: by asking a lot of questions.

    Rick Kahler MS CFP®


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