Revisions to the CFP Board’s sanction guidelines will likely be released for public comment by midyear, according to new CFP Board Chair Daniel Moisand.
In an interview with WealthManagement.com, Moisand said any conversation about sanctions is always “a source of potential controversy,” but he said he is interested in the substance of the forthcoming comments.
"The idea behind a sanction guideline is to bring some consistency between the sanction imposed and the offense,” Moisand said. “You don’t ticket someone who gently rolls through a stop sign the way you ticket a drunk driver.”
Moisand, who is succeeding Kamila Elliott as CFP Board chair, has more than 30 years in the industry and is a principal and advisor at Moisand, Fitzgerald, Tamayo, with offices in Orlando, Melbourne and Tampa, Fla.
He’s also served on the CFP Board’s board of directors since 2020, with previous stints on its Board of Practice Standards and serving as the chair of its Disciplinary and Ethics Commission (DEC) in 2008. Moisand also was previously a national president for the Financial Planning Association.
The revisions expected later this year are a continuation of proposed updates released in 2021. In February of that year, the board announced a new commission to examine changes to its sanction guidelines that were established to help the DEC determine how to appropriately punish CFP professionals, with previous guidelines listing aggravating or mitigating factors that could affect the eventual sanctions.
At the time, CFP Board CEO Kevin Keller called it the “third and final phase” of a total review of the Board’s enforcement process, including revisions of its code of ethics and a 2020 overhaul of its procedural rules. The Board reexamined much of its enforcement protocols after reporting by The Wall Street Journal in 2019 alleging the board failed to vet thousands of CFP professionals regulatory, disciplinary and criminal history, and hadn’t included that information on its online search website for investors.
To Moisand, updates to sanction guidelines were needed to ensure they kept up with the realities CFP professionals faced, recalling that when he first became a certified planner in 1994, there were no sanction guidelines.
As an example, Moisand said most would agree that if someone brought a “cheat sheet” into an exam site, there should be repercussions, but he then relayed the story of a professional who shared some of the questions they had in a Reddit group, a scenario the Board never would have faced at the outset of Moisand’s career.
“Those sanctions probably shouldn’t be the same, or maybe they should,” he said. “The whole purpose of having the sanctions committee is to look at issues like that and have some determinations and guidelines of what possible sanctions should be.”
Moisand noted that to boost its enforcement response, the Board created a stand-alone Code and Standards Enforcement Committee and has increased staff for investigations. In the coming year, Moisand said the Board would also work on improving the clarity of communications detailing why professionals were sanctioned. He recalled that, in the past, you might see someone suspended for a few months and not understand how that length of time was determined.
While he said there’d been “progression and improvement,” he expected sanction descriptions to become more detailed throughout 2023.
“We want CFP professionals to comply, and one of the easiest learning tools for how these things work are actual cases,” he said.
Under Moisand’s tenure, the Board will also continue its recently announced review of its competency standards for education, examinations, experience and continuing education of professionals. Moisand predicted an exhaustive process for the review, noting the ground such an analysis would have to cover, and predicted the whole process would take until at least the end of 2025.
“I’d like it to happen fast, but it’s better to get it right than get it done quickly,” he said.
The Board previously elected Matthew Boersen, 34, a managing partner with the Grand Rapids, Mich.–based firm Straight Path Wealth Management, as its 2023 chair-elect. When Boersen takes over from Moisand at the end of this year, he will become the youngest chair in the Board’s history.