CFP Board lawsuit gets judicial green light
A US-based legal dispute between the CFP Board of Standards and a financial advice firm has been given the go ahead in a US District Court, in a case with implications for the US industry.
In a decision handed down on January 26, the US District Court of the District of Columbia ruled that the litigation suit brought by Florida financial advisers Jeffrey and Kimberly Camarda against the CFP Board – which administers the Certified Financial Planner designation in the United States – can continue and expand in scope.
The suit was brought in 2013 when Mr and Mrs Camarda sought the jurisdiction of the courts to block a public admonition from the CFP Board, which argued the Camardas had deceptively used the term “fee-only” to describe their financial planning services on marketing materials.
Describing the ruling as a “blow to the CFP Board”, US financial planning commentator Michael Kitces said the final decision in this case may have broad implications for American advisers and the board itself.
“This case is no longer 'just' about the definition of fee-only; it's now about the legitimacy of the organisation's enforcement process and the standards for all CFP certificants, and raises the question of whether the CFP Board may have made a serious strategic mistake by trying to make Camarda vs CFP Board of Standards its defining case,” Mr Kitces said in a blog post.
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