Question 1

Which of the following policies will most likely violate standards related to fair dealing for all
clients?
a) Extending the time frame between the decision to make an investment
recommendation and the time the actual recommendation is disseminated.
b) Limiting the number of people involved in the decision of dissemination of
recommendations.
c) Developing and documenting trade allocation procedures, including procedures for
calculating execution prices and “partial fills” when the trades are grouped.

Question 2
According to Standard III(A): Loyalty, Prudence, and Care, soft-dollar agreements:
a) Violate the duty of loyalty to the client
b) Do not violate the duty of loyalty to the client as long as the goods and services
purchased with soft-dollar commissions are used to benefit the client
c) Never violate the duty of loyalty to the client

Question 3
Sarah Mina of Star Magic Investments purchased two blocks of shares at two different
prices to secure the shares of all accounts under her management. She then allocated the
first and second blocks to individual and institutional accounts, respectively. Mina's action
is:
a) Not allowed under the Code and Standards.
b) Allowed only if clients are notified of allocation procedure.
c) Aligned with her responsibilities under the Code and Standards.

Question 4
Victoria Anderson, CFA, works for Pluto Capital, a newly established investment counseling
firm. The founding partners of Pluto Capital came from Vulcan Investments after it was
taken over by a large financial services group. Jonathan Beecham is meeting with Pluto
Capital for the first time because he has been disappointed by Vulcan's underperformance
following the takeover. At the beginning of their meeting, Anderson sympathizes with his
situation, then immediately explains to Beecham that she has discovered an undervalued
stock that offers large potential gains. Anderson then promises Beecham that she can buy
the stock for his account at the current price if he switches the account within 48 hours.
Anderson's best course of action to avoid violating the Standards was to have:
a) elaborated on the technical features of Pluto's standard valuation method used to
identify the undervaluation.
b) avoided the meeting with Beecham in the first place because the founding partners
of Pluto came from Vulcan.
c) determined Beecham's investment needs, objectives, and tolerance for risk before
making any investment recommendation.
Question 5
Jessica Francis, a manager at Duke Mutual Funds Corp., is preparing a client presentation in
which she excluded past performance of a few composites that had not performed well. She
does mention the exclusion of terminated accounts, many of which contributed to the
previous year's performance. Jessica's manager was very impressed with the presentation,
as it improved the overall returns earned by the firm. He forwarded the presentation to the
clients. Which of the following statements is least accurate?
a) Jessica has violated the standards by excluding past performance of composites.
b) Jessica has not violated the standards, as she has performed her duties to her
employer.
c) Jessica has not violated the standards by mentioning the terminated accounts that
contributed to the previous year's performance.

Question 6
Gabrielle Thomas, a client of Ruby Advisors Inc., noticed that the actual performance of the
firm varies significantly from her estimation. When she discussed this issue with the firm,
the manager informed her that it keeps revising the performance calculation methods.
Gabrielle insisted that the firm should follow a single method for performance calculation
and the clients should be made aware of any change in the methodology of the calculation.
Based on the information, which of the following is true?
a) Ruby Inc. should implement Gabrielle's suggestion, but it can revise its performance
calculation methodology periodically.
b) Ruby Inc. need not implement Gabrielle's suggestion, as she is not an investment
professional.
c) Ruby Inc. should implement Gabrielle's suggestion, but it cannot revise its
performance calculation methodology periodically.

Question 7
Patricia Loveday, CFA, is a portfolio manager of Raven Asset Management. Recently, she
won a mandate from the Flemish Trust pension fund trustees to manage the investments of
the fund. One of the Flemish Trust trustees privately mentions that Loveday should direct
her trades to Churner Securities, which is owned by a relative of one of the trustees.
Loveday, for fear of losing the account, directs 50% of the trades to Churner Securities. She
is pleased to find that Churner's quality of execution is good and the quality of their
emerging-market research is excellent. Although Flemish Trust does not invest in emerging
markets, Loveday finds the research useful for the other funds she manages. Loveday
decides not to inform anyone regarding the situation. According to the Code and Standards:
a) Loveday should stop trading with Churner Securities.
b) Loveday may continue trading with Churner Securities.
c) Loveday should disclose this arrangement to Flemish Trust.

Question 8
Which of the following is the least accurate policy of investment firms?
 a) Investments can differ from the IPS when a client requests to change the
investment strategy on an ad hoc basis.
b) Firms can offer different levels of service based on the client's fees and type of
service the client needs.
c) Firms can ask the employees to disclose all their personal investments when
required.

Question 9
Which of the following policies on communication of investment recommendations is most
likely to be in compliance with Standard III(B): Fair Dealing?
a) All clients are communicated with on a uniform basis.
b) Information is disseminated in a way such that all clients have a fair opportunity to
act on every recommendation.
c) Communications are made with clients in order of size.

Question 10
Maria Park, an investment advisor, manages the retirement fund of Jane Hayden, who
wants to invest only in safe investment securities. Which of the following actions of Maria
violates the standards of ethics?
a) Maria invests in US government bonds that yield the lowest return.
b) Maria invests in bonds issued by foreign governments and partly in US Treasury
bills.
c) Maria invests in corporate bonds with AAA rating and venture capital funds.

Question 11
James Smith, an investment advisor, uses his clients' residual capital to trade in his personal
account without getting permission from them. However, he returns the funds to the
clients' accounts once he completes his transactions. Which of the following statements is
most accurate?
a) James has violated Standard III(A), as he is returning the clients' money without any
interest.
b) James has violated Standard III(A), as he is using the clients' money for personal
benefits.
c) James has not violated the standards, as he has used the residual money.

Question 12
Frank Queens, CFA, manages a few big institutional accounts and a number of individual
accounts. All the accounts he manages share a similar risk and return profile and are subject
to the same tax situation. He always allocates block shares to the institutional accounts first,
and if there is anything left, he will allocate them to the individual accounts based on their
portfolio sizes. Did Queens violate any CFA Institute Standard when allocating shares from
block shares?
a) Violated Standard III(B) Fair Dealing.
 b) Violated Standard III(A) Loyalty, Prudence, and Care 

c) Did not violate any Standards.

Question 13
When there is a conflict between the Code and Standards and the local law, the firm should
follow:
a) the Code and Standards, irrespective of the local law.
b) local law governing the country, irrespective of the proposed standard.
c) the stricter of the two.

Question 14
Fred Miller manages the pension fund of Kribon Corp. Kribon's CFO asks Fred to invest in a
derivative contract that will yield a higher interest rate. However, Fred is apprehensive, as
this investment will lock the funds for a longer time and will not meet the liquidity
requirements of the company. Fred should:
a) Agree to the CFO's request; otherwise, he will be violating his duties to the client.
b) Not agree to the CFO's request; otherwise, he will be violating his duties to his
employer.
c) Not agree to the CFO's request; otherwise, he will be violating his duties to the
client.

Question 15
According to Standard III(C): Suitability, members and candidates who receive a request
from a client for a trade that does not properly align with the risk and return objectives
outlined in the client's investment policy statement should:
a) Refuse to accept the order
b) Refrain from making the trade until concerns have been discussed with the client
c) Execute the trade, but discuss concerns with the client as soon as practically
possible

Question 16
Helen Walters, CFA, manages the investment for a large family trust as her only client. One
of the family trust's largest holdings is a security firm. Knowing the significant holding by her
client, the security firm allows Walters to use its research modeling software for free. This is
not a violation if Walters:
a) Discloses the relationship to the client and requests a written consent.
b) Uses the software solely to benefit the family trust.
c) Does all of the above.

Question 17
David Haynes is a portfolio manager who manages a mixture of different funds, including
growth funds and high-income dividend funds. He is very confident that he has identified a
significantly undervalued opportunity in a high-tech growth investment that currently does
not pay a dividend. Haynes is so convinced by the opportunity that he feels all of his funds
should benefit from it, and subsequently allocates shares across all of his portfolios. His
analysis turns out to be correct and the shares perform very strongly. According to Standard
III(C): Suitability, Haynes has:
a) violated the Standard
b) not violated the Standard since his analysis was based on a reasonable basis
c) not violated the Standard since his clients benefited from his actions

Question 18
Which of the following statements best characterizes the requirements of Standard III(D):
Performance Presentation?
a) Members and candidates must comply with GIPS standards.
b) Members and candidates should encourage their firms to comply with GIPS
standards.
c) Members and candidates should only seek employment at firms that adhere to
GIPS standards.

Question 19
Martin Green provides retirement planning advice to high-net-worth individuals. One of his
clients, Sunhil Baal, is a successful entrepreneur who runs several small businesses locally.
Green notices that Baal is currently contributing to his pension plan in a manner that is very
tax inefficient. He consults a colleague, Paul Rodgers, and discusses the sources of income
that Baal has and the pension contributions that he makes. Rodgers agrees that Baal could
make significant tax savings through changing the way he contributes to his personal
pension plan, and agrees to contact Baal regarding his situation. Which of the following
statements is most accurate regarding Green's behavior? Green is:
a) In violation of Standard III(E): Preservation of Confidentiality
b) Not in violation of Standard III(E): Preservation of Confidentiality since his actions
have benefited the client
c) Not in violation of Standard III(E): Preservation of Confidentiality since Rodgers is a
colleague of Green

Question 20
Which of the following activities by the members will reflect credit on members and the
profession according to the Code of Ethics?
a) Practice and encourage others to practice in a professional and ethical manner.
b) Use reasonable care and judgment to achieve and maintain independence and
objectivity in their professional activities.
c) Must not engage in practices that distort prices or artificially inflate trading volume
with the intent to mislead market participants.
Question 21
Chris Lopez, an investment advisor, allocates all trading transactions of his clients to Triblon
Inc., a brokerage firm. Triblon Inc. has a poor reputation and is known for charging
exorbitant fees. Chris gets a commission from Triblon for giving business to them. Which of
the following violates the standards of ethics?
a) Chris discloses the arrangement with Triblon to his clients when discussing
investment recommendations.
b) Chris promises his clients that he will always act in their best interest by choosing
suitable investments.
c) Chris promises his clients that he will manage the accounts by providing quality
service at an affordable price.

Question 22
Clark Hutchison, a client of investment advisor Benjamin Thomas, calls Benjamin and asks
him to invest in a newly launched mutual fund that promises to return high yield. Benjamin
is not optimistic about the fund's prospects, and the client's investment policy statement
(IPS) is confined only to government securities, as the investor is extremely risk averse.
Benjamin's firm strictly adheres to the IPS and does not allow advisors to entertain any ad
hoc requests. Which of the following actions of Benjamin, if true, will least likely violate the
standards?
a) Benjamin follows the client's request, but does not make any change in the IPS.
b) Benjamin does not follow the client's request and educates the client, as he cannot
change the IPS without the employer's approval.
c) Benjamin follows the client's request, but modifies the IPS with the client's
approval.

Question 23
John Chan, an investment manager, has a client who used to work for E-tech Inc., a start-up
company trading on a Canadian venture exchange with low volume. The client owns a large
number of E-tech stocks through exercising his stock option, and E-tech is the only stock in
his portfolio. Based on his rigorous analysis, Chan believes that E-tech will perform well in
the long run. With the client's agreement, Chan arranges a series of cross-trades of E-tech
stocks from the client's portfolio to his other existing clients, and the trades were executed
at approximately the current market price. Chan's action is:
a) In violation of Standard III(B) Fair Dealing because Chan is giving both buy and sell
recommendations to clients.
b) Not in violation of any Standards.
c) In violation of Standard II(B) Market Manipulation because Chan is artificially
creating trading volume of E-tech stocks.

Question 24
Three investment managers have the following arrangements for voting proxies:

• Manager A votes on all proxy matters that arise on client portfolios.

 • Manager B has conducted a cost-benefit analysis and only votes on
proxies where the benefits of doing so outweigh the costs.
• Manager C has a policy of always voting proxies in line with
management in order to ensure smooth running of company policy.

Which of these managers is least likely to be in violation of Standard III(A): Loyalty,

Prudence, and Care?
a) Manager A
b) Manager B
c) Manager C

Question 25
Mike Jones, an investment manager, hosts regular luncheons for his clients. He has clearly
informed the clients that the luncheons are just a social gathering for sharing general
information about the firm's activities. Clients are also requested to refrain from discussing
any confidential matters in that forum. In one such gathering, Bella Thomas, a high-net-
worth client, inquired about her investments with Mike. Which of the following is most
accurate?
a) Mike is not at fault, as he did not disclose any information.
b) Bella is at fault, as she disclosed her details.
c) Mike's employer is at fault for hosting such gatherings.

Question 26
Engelbert Sy, CFA, works at Energyside Fund as a portfolio manager. After an extensive
research process and assessing the clients' suitability, Sy purchased the bonds of Company
Wiz for a few clients. A week after the purchase, an unexpected lawsuit was filed against
Company Wiz for a patent violation, and the bond price dropped significantly. The clients
who purchased the bonds criticized Energyside stating that the bonds were unsuitable
investments. Did Sy violate any CFA Institute Standards?
a) Violated Standard V (A) Diligence and Reasonable Basis.
b) Did not violate any Standard.
c) Violated Standard III (C) Suitability.

Question 27
A recommended performance presentation procedure is:
a) To indicate clearly whether performance is gross or net of fees.
b) To adhere to prior-year presentation formats when presenting performance to an
audience.
c) To report performance of a representative portfolio manager.

Question 28
Rebeca Fabrics Corp. moved its pension fund from Bluedrop Investments Inc. to Triumph
Advisory Inc. Bluedrop also published reports for Rebeca and had its research details. One of
Rebeca's competitors approached Bluedrop to share information about Rebeca. Bluedrop
shared the information, as Rebeca was no longer its client. Can Bluedrop share the
information with the competitor?
a) No, but it can share research information that is nonmaterial and nonpublic.
b) Yes, it can share the information, as Rebeca is no longer its client.
c) No, it cannot share any information.

Question 29
During an official trip, analyst Adrian Lee's laptop was stolen. He had all his clients'
confidential information stored in the laptop. Adrian's employer has a strict policy regarding
the storage of client details in electronic medium and gives employees regular training on
the maintenance of data security. As per the policy, Adrian should delete the data in the
laptop remotely, but he did not file a legal complaint about the theft. One month later,
Adrian's employer was sued by a client for leaking confidential information, as Adrian did
not file a legal complaint. Which of the following statements is most accurate?
a) Adrian is not at fault because the laptop was stolen a month back.
b) Adrian is at fault because he did not ensure the data security of the clients.
c) Adrian is at fault only in not filing a legal complaint as mentioned by the employer.

Question 30
Martina Ricci, a fund manager with Abbotswood Advisors, has just been given the authority
to manage a newly acquired client that has a retirement benefit plan, when she realizes that
a US government bond belonging to the account matures the next day. The bond comprises
5% of the total assets. Abbotswood Advisors is still in the midst of a discussion with the
client regarding the formulation of a new investment policy and portfolio objectives.
Looking at what the current market has to offer, there are a number of attractive
opportunities. One opportunity that stands out is a corporate bond of a major oil company
that went out of favor due to an environmental accident that occurred the week before. She
has followed the oil company for a number of years and knows that its fundamentals are
sound. The prospect of an improved credit rating in the next 6 months is not yet reflected in
the current price. Her supervisor asks Ricci to invest the proceeds in the corporate bond.
Ricci prefers, however, to invest them in 3-month Treasury bills, albeit with a much lower
yield, until the new investment policy and objectives are formulated. What is the best
course of action for Ricci?
a) Invest in the Treasury bills until the new investment policy and objectives are
established.
b) Split the investment between the corporate bond and the Treasury bills to diversify
the risk.
c) Follow her supervisor's direction as the corporate bond opportunity will benefit the
overall performance of the fund.
Question 31
Lenny Holmes, joined a brokerage firm where her sister Penny Holmes is a client. Which of
the following approaches of Lenny will least likely be in accordance with the Standards of
Professional Conduct?
a) Lenny accepts an expensive birthday gift from Penny.
b) Lenny provides investment reccomendations to Penny only after disseminating
information to all other clients to avoid any accusation of wrongdoing.
c) Lenny gives preference to premium clients over Penny, as she did not opt for that
service.

Question 32
Which of the following is false regarding the participation or association of violations by
others according to the Code of Ethics?
a) Members should disassociate or separate from the unethical activities.
b) Inaction combined with continuing association as it is the duties of the Compliance
Department.
c) Members should stop the behavior by informing the unethical activities to the
supervisor or Compliance Department.

Question 33
Which of the following is most accurate about proxy voting?
a) Investment firms should give least priority to proxy voting, as it is not their core
activity.
b) Investment firms should not take the responsibility of proxy voting, as it involves
only nongovernance issues.
c) Investment firms should make policies for proxy voting that will contribute to
clients' economic value.

Question 34
Steven Burrell produces a performance presentation that does not adhere to GIPS standards
and includes some simulated data. Which of the following statements is most accurate in
relation to the requirements of Standard III(D): Performance Presentation?
a) Burrell is in violation of the Standards since use of simulated data is not allowed.
b) Burrell should produce separate reports for actual data and simulated data.
c) Burrell should disclose the use of simulated data in the presentation to the
recipients of the information.

Question 35
Brian Clayton, CFA, manages the discretionary account of the Lewin Jones Corporation
employees' profit-sharing plan. Diane Lewin, the company president, recently asked Clayton
to vote on behalf of the shares in the firm's profit-sharing plan in favor of the company-
nominated slate of directors and against the slate of directors sponsored by a corporate-
raider stockholder group. Clayton does not want to lose Lewin Jones as a client, because the
account generates more than 20% of his firm's revenues. Clayton investigates the proxy-
fight issue and realizes that the corporate raider's slate of directors would probably be
better for the long-run performance of the firm than that recommended by the
management. However, Clayton fears that the new board, which he hardly knows, will shift
the business to a competing investment firm as often happens in corporate takeovers.
According to the Code and Standards, Clayton should:
a) Vote in the manner requested by Lewin due to her importance as a major client.
b) Vote against the corporate raider's recommendation if he believes corporate
raiding is unethical.
c) Vote in favor of the corporate raider's recommendation since it is in the best
interest of the participants and beneficiaries of the employees' profit sharing plan.

Question 36
Which of the following actions by an investment manager will least likely violate Standard III
Duties to Clients?
a) Providing client information to CFA Institute.
b) Utilizing a client's brokerage to buy goods or services that are used for the benefits
of all clients.
c) Voting proxies to support the major shareholders on behalf of clients.

Question 37
Lara Jones, an investment advisor, sends her recommendations to her clients by e-mail. She
asks her colleague to call and explain the recommendations to her premium clients, which is
a part of their service. Patrick D'Souza, one of her clients, was missed in her e-mail list for an
upcoming IPO issue, as his request for a change in the IPS was not updated for IPO issues.
Which of the following is least likely to prevent Lara from violating the standards?
a) Lara has not violated the standards because the IPS was not updated.
b) Lara has not violated the standards because Patrick was not a premium client.
c) Lara has not violated the standards because Patrick was not in the e-mail list.

Question 38
Hank Brown, an analyst, is examining the internal reports of a Chinese firm, FinYang Corp.
One of the competitors of FinYang Corp. approaches Hank to reveal FinYang's investments
in research facilities. Hank's firm is offered a consultation fee of $100,000 for this
information. Hank does not accept the offer, but his manager does. Hank provides the
details to the manager.
a) Only Hank has violated the standards.
b) Only Hank's manager has violated the standards.
c) Both Hank and his manager have violated the standards.

Question 39
Kate Lohan, CFA, an analyst in a brokerage firm, observes that the management accepts
commission from certain corporations to trade their securities in order to improve the
liquidity of their stocks. Kate discusses the issue with her supervisor, but decides to report
to an external regulator, as it appears that this is the way the brokerage firm was making its
profits. Which of the following statements is most accurate?

• Statement I: Kate has not violated Standard IV pertaining to duties to

employers.
• Statement II: Kate has acted against the violation of Standard II
regarding market manipulation.
• Statement III: Kate has violated Standard III pertaining to duties to
clients by reporting to an external regulator.

•
a) Statements I and II.

b) Statements II and III.

c) Statements I and III.

Question 40
Rolly Bee, CFA, met a high school classmate, Raf Yu, at a social gathering. Knowing Bee is an
investment adviser, Yu asked Bee for stock tips. Bee invited Yu to come to his office to
review Yu's risk and return objectives. At the end of their appointment, Bee recommended
two securities that he had thoroughly researched and thought they met Yu's risk and return
objectives. Bee is:
a) Not in violation as the securities he recommended were based on a diligent
analysis.
b) Not in violation as Yu is not his client.
c) In violation as he didn't inquire about Yu's investment experience and financial
constraints.

Question 41
Ken James, CFA, is an economist at a large bank and he has never made direct investment
decisions. James is the latest winner of a well-publicized portfolio management competition
in a national newspaper. Following this success, he is launching an investment fund. In the
prospectus he tells the prospective clients, “The fund has no long-term track record, but the
investment manager has shown considerable skills in managing hypothetical portfolios. In a
competition the manager has demonstrated a portfolio total return above 26% per year
annualized, and that is more than 12% above the benchmark for the same period.” He
managed to raise a significant amount of money from retail investors who are interested in
investing in the fund. Has James violated the Code and Standards?
a) Yes, because the statement misrepresents James's track record.
b) Yes, because he should not quote performance for a hypothetical portfolio.
c) No, because the statement is a true and accurate description of James's track record.
Question 42
Benny Chemicals Corp. is a client of Skyhigh Advisory Inc., which provides investment
banking solutions. Benny offers more business to Skyhigh if Skyhigh directs its clients to Zeal
Brokerage firm, in which Benny has 20% ownership. Skyhigh accepts Benny's deal but
mentions its new business arrangement in a meeting that was held for premium clients
whose transactions will be directed to Zeal. Which of the following is most accurate?
a) Skyhigh has violated the confidentiality of Benny as a client.
b) Skyhigh has not violated the standards by directing its clients to Zeal.
c) Skyhigh has violated the duties to other, nonpremium clients.

Question 43
Which of the following statements clearly conflicts with the recommended procedures for
compliance with Standard III(B): Fair Dealing when a firm is changing an investment
recommendation?
a) Maintain a list of clients and their holdings
b) Limit the number of people involved
c) Lengthen the time frame between decision and dissemination

Question 44
Swankit Inc., an investment firm, hires business graduates for its internship program. The
hired interns work on emerging markets and prepare research report at the end of their
internship tenure. Swankit publishes these reports as its own research developed by its full-
time employees. Which of the following statements is most accurate?
a) Swankit has violated Standard III(D) and not violated Standard I(C).
b) Swankit has violated Standard III(D) pertaining to misrepresentation only in
publishing a third-party research as its own.
c) Swankit has violated Standard I(C) pertaining to misrepresentation only in
publishing a third-party research as its own.

Question 45
Jake Gore, an employee of Kenpek Investments Inc., is informed that Kenpek is one of the
three contenders for the underwriting of a leading IPO. Jake immediately calls his friend in
one of the other firms that could be possibly handling the IPO and books shares. Which of
the following statements is most accurate?
a) Jake should inform his employer about his investment after booking the shares.
b) Jake should inform his employer about his investment before booking the shares.
c) Jake need not inform his employer about his investment, as he is booking the share
with another firm.

Question 46
Rajesh Singh manages investments of a client who owns an ammunition factory. An
investigating agency suspects the client of involvement in some illegal activity. It asks Rajesh
to share the investment details of the client. Which of the following is the best
recommended action?
a) Rajesh should not disclose any details of the client.
b) Rajesh should disclose all the details of the client.
c) Rajesh should disclose only partial information approved by the client.

Question 47
If a CFA charter holder was drinking too much wine during a lunch meeting with a client, and
returned to work under significant alcohol influence, he:
a) Violated Standard I(D).
b) Violated Standard III(A).
c) Did not violate any standard because he drank with the client.

Question 48
Which of the following is the most accurate statement concerning Members and Candidates
in accordance with Standard III (A) Loyalty, Prudence, and Care? Members and candidates
should:
a) Use client brokerage to purchase research reports for the benefits of the firm.
b) Vote proxies in an informed and responsible manner on behalf of the clients, if so
requested by the clients.
c) Develop and maintain appropriate records to support their investment analysis.

Question 49
Randolph Investment Advisory Inc. offers different levels of service to its clients based on
the amount invested by the clients. Randolph is least likely to violate the standards:
a) If it passes the information about the IPO to premium clients through phone calls
and others through e-mails.
b) If it offers the best price to premium clients and a different price to other clients.
c) If it allocates shares based on prebooking done by the clients through an online
portal.

Question 50
Muhammad Taqdir, CFA, is an investment manager whose clients are high-net-worth
individuals. Taqdir is a member of a local charity organization that supports children with
asthma. During a meeting at the charity, Taqdir recommends that the organization send a
letter to Xara Corporation requesting they make a donation to the charity. Taqdir knows of
Xara Corporation's involvement in this cause from previous discussions with a colleague in
the office. The chief executive and owner of Xara Corporation is a client of the firm. The
charity, citing Taqdir's recommendation, sent the letter and received a substantial donation.
According to the CFA Institute Code and Standards:
a) Taqdir should not have disclosed the identity of the chief executive without his
prior approval.
b) Taqdir should have informed the chief executive of Xara that he was going to
receive a letter from the organization.
c) If Taqdir had the prior approval of his colleague, it was acceptable to disclose the
name of the chief executive of Xara.