Question

In defining the relationship with the prospective client, which rule covers the term under which the agreement permits the certificant to offer proprietary products?

A. 2.2
B. 2.1
C. 1.1
D. 1.2
E. A CFP® certificant cannot sell proprietary products.

Answer 1

The rule that covers the term under which the agreement permits the certificant to offer proprietary products is Rule 1.2. This rule allows a CFP® certificant to sell proprietary products while acting in the client's best interest and disclosing any conflicts of interest.

Step-by-step explanation:

The rule that covers the term under which the agreement permits the certificant to offer proprietary products is Rule 1.2.

This rule states that a CFP® certificant can offer or sell proprietary products but must always act in the best interest of the client and disclose any conflicts of interest. This means that while a certificant can sell their own products, they must prioritize the client's needs and provide full transparency.

For example, if a CFP® certificant works for a company that offers proprietary mutual funds, they can sell those funds to their clients. However, they must make it clear to the client that these funds are in-house products and explain any potential conflicts of interest.