United States
Hong KongWho regulates CFP professionals?
CFP Board is a private certifying body that can remove the right to use the marks. Actual regulation comes from the SEC, state securities regulators, FINRA and state insurance departments, depending on the activity.
A distinction the exam tests directly, and one clients almost never understand.
What CFP Board is
A private, non-profit certifying body. It sets standards, awards certification and enforces its Code and Standards against people who hold it. Not a regulator.
It can impose a private censure, a public censure, a suspension of up to five years, or a permanent bar. Those affect the right to use the marks.
What it cannot do
- Fine you.
- Revoke a securities or insurance license.
- Order restitution to a client.
- Bar you from the industry.
- Bring criminal proceedings.
A planner barred by CFP Board can continue advising clients, provided they hold the relevant licenses and are not barred by an actual regulator. That surprises people and it is the position. That surprises people.
Who actually regulates
| Activity | Regulator |
|---|---|
| Investment advice for compensation | The SEC, or a state securities regulator |
| Selling securities | FINRA, and the SEC |
| Selling insurance | The state insurance department |
| Tax return preparation | The IRS, and some states |
| Banking products | Banking regulators |
Most planners sit under several at once, and which apply depends on what they actually do rather than on what they call themselves.
A question describing a CFP professional giving investment advice without registration is testing whether you know the marks authorize nothing. Certification describes competence; registration permits activity. The Standards also require compliance with the law, so a regulatory breach is a Standards breach too.
The overlapping standards
A CFP professional owes a fiduciary duty at all times when providing Financial Advice, under CFP Board's Standards.
The regulatory standard applying to their role may be lower - Regulation Best Interest for a registered representative, for instance. The CFP duty applies regardless, which means a certificant can be compliant with their regulator and in breach of the Standards.
For consumers
A complaint may go to CFP Board, to a regulator, or to both, and they are different processes with different powers and outcomes. Different powers.
CFP Board can remove the marks. A regulator can do considerably more, and knowing which body handles what is genuinely useful information to be able to give a client.
CFP® is a registered mark of Certified Financial Planner Board of Standards, Inc. We are not affiliated with, or endorsed by, CFP Board. Confirm details against cfp.net, which is the authority.
Common questions
Is CFP Board a regulator?
No. It is a private certifying body that sets standards, awards certification and enforces its Code and Standards. It can remove the right to use the marks and nothing more.
What can CFP Board not do?
Fine you, revoke a securities or insurance license, order restitution, bar you from the industry, or bring criminal proceedings.
Who actually regulates financial planners?
The SEC or a state securities regulator for investment advice, FINRA and the SEC for securities sales, state insurance departments for insurance, and the IRS for tax preparation.
Can you be compliant with a regulator and in breach of the Standards?
Yes. A CFP professional owes a fiduciary duty at all times when providing Financial Advice even where the regulatory standard applying to their role is lower.
Where should a client complain?
CFP Board, a regulator, or both - they are different processes with different powers. CFP Board can remove the marks; a regulator can do considerably more.