Those who call themselves CFPs, but aren’t really!
Individuals are using a mark when they are not licensed, passing themselves off as something they are not - misleading the public when they use the CFP®, FSA™ or RFP™ mark. Is this common practice?
Misleading the public
Dirk Groeneveld, Certified Financial Planner (CFP®) at Altius Trading 9, t/a Client Care, said he is not aware of how common this is, but he is sure it happens.
Kobus Kleyn, CFP® at Kainos Wealth Pty Ltd said, “As the CFP® designation is a registered international premier designation with the Financial Planning Standards Board (FPSB) and issued by the Financial Planning Institute of Southern Africa (FPI), it would not at all be allowed to be used by anyone who is not registered with the FPI as a member. If anyone is using the designation without being a member of FPI or their own international professional body globally, then it would be misrepresentation, an offence under the Financial Advisory & Intermediary Services (FAIS) Act and can lead to the adviser losing their license or being suspended or debarred. And, the Financial Sector Conduct Authority (FSCA) or any Financial Services Provider (FSP) would have to take action, as well as the local professional body.”
Kobus Oosthuizen, CFP® and Manager of Legal & Governance at FPI said, “It is, unfortunately, more common than one would expect. When advisers feel the need to use FPI’s professional designations or an association with FPI when there is none, it proves the intrinsic value of the trademark. There are mainly two types of infringers, namely people who had been FPI professional members previously and who had been terminated, or themselves terminated membership, and then newly qualified Higher Diplomats in Financial Planning who do not know they must pass a professional competency examination first.”
“Many designates maybe do not realise that if you do not renew your FPI membership annually, verify your fit and proper status, and have 35 Continuous Professional Development (CPD) hours completed, you are not allowed to use the designation at all,” added Kleyn.
Oosthuizen emphasised that, “It is actually a legal thing. FPI’s designations are registered with SAQA, and to validly pass yourself off as a professional, you must comply with the annual and standards requirements. If you do not fulfil these requirements, it is very much like presenting you have a degree when you don’t. Doing that is fraud. The only difference is that designations are not qualifications like degrees that are earned once-off. By law you must fulfil ongoing requirements, which includes CPD, to maintain recognition as a professional under the SAQA regulatory framework.”
Tarnishing industry reputation
Now, this is where Kleyn believes we have a possible problem, and FPI should be auditing social media like LinkedIn to make sure it is not happening.
“It tarnishes our reputation as professionals. It harms our profession, as the financial consumer believes they are dealing with a professional and are protected but would not per se be fully protected. It is up to our Professional Body to protect us, by conducting regular audits on social media, where the abuse will happen. FSPs also have a role to play, to make sure their agents and advice partners are not misrepresenting,” continued Kleyn.
“If the advice given by these people is not in the clients’ best interests, it would definitely tarnish the industry name. I am not convinced that the public are aware of the CFP® designation and what it represents. We need to do more to promote this,” added Groeneveld.
“FPI indeed monitors this on an ongoing basis”, says Oosthuizen, “we engage with people and the financial sector on an ongoing basis with positive outcomes mostly. But this is not something FPI can do on its own, the legitimate professionals should be as vigilant and report any misrepresentation to FPI for action.”
The distinguishing factor
How should real professionals stand up and fight for what is theirs? “By promoting the CFP® mark, and I believe, by calling out poor work which does not serve clients, the passive route is quite frankly not working,” continued Groeneveld.
Kleyn added that, “The CFP® designation is also issued to financial planners where they can prove minimum criteria is met and include practical experience. There is no simple one way to separate newbies (5 years or less), inbetweeners (5-20 years) and masters (20 years plus), but experience cannot be bought off the shelf. Therefore, it is up to the financial consumer to consider years of service, as they would do with a GP, Lawyer etc., to identify a track record. A CFP® is only an indication of competency to start with, but it is not to say all designates are the best advisers to obtain services from. So, for example, would a client deal with a CFP® with three years of service or with a financial planner with 30 years of experience and with recognition of prior learnings?”
Oosthuizen agreed. “It is true that people obtain experience over time and that is why FPI have an experience requirement associated with its designations. Without experience, aspirants often enter FPI’s mentorship programme to gain that experience in a professional practice recognised by FPI.”
Kleyn emphasised that, “All we can do as CFP® professionals is to drive awareness to our designation and our professional body and be proud to represent our profession and consummate professionals. We must lead by example and proudly display our designation at every opportunity. We should never bad mouth anyone without a designation, as we all had to start at the bottom. We should instead encourage our fellow advisers to strive to obtain their designations, as the more of us that have them, the sooner we will uplift the status of our industry into a profession.”
Oosthuizen said, “It is easy to check whether a person who displays an FPI designation, CFP®, FSA™ or RFP™, is compliant at the FPI. Our letsplan.co.za website can be consulted.”
A word of advice
“We are here to serve our clients first, not to enrich ourselves at their expense. Proper financial planning should be a calling to help others not just a road to riches. Experienced advisers should also be doing more to pave the way for young planners new to the industry, we need to give back. Newbies may be more up to date technically, having recently done exams, where-as oldies have far more experience,” concluded Groeneveld.
Kobus concluded by saying that “We are not an industry, but we are a profession. If we refer to ourselves as an industry, we will stay an industry and never evolve into a profession. An Industry is an economic activity concerned with the processing of raw materials and the manufacture of goods in factories, or in our case, products like policies. If we want to uplift our status to a full-fledged profession, we need to walk the talk, and qualification and designations must form part of it. A profession is a vocation founded upon specialised educational training, the purpose of which is to supply objective counsel and service to others, for direct and definite compensation, wholly apart from expectation of another business gain. A profession arises when any trade or occupation transforms itself through the development of formal qualifications based upon education, apprenticeship, and examinations, the emergence of regulatory bodies with powers to admit and discipline members according to a code of conduct and ethics. It is time for all of us as advisers and planners to work towards a profession and professional status.”
“FPI professional members have worked hard to gain the recognition they get, and they fulfil the ongoing requirements studiously. This is a characteristic of professionalism. We should not tolerate reputation thieves,” stated Oosthuizen.
Writer’s Thoughts:
I fully agree with Oosthuizen - professionals have worked hard to gain the recognition they get and fulfil the ongoing requirements studiously. Do you believe is it more common than one would expect for individuals to use a mark when they are not licensed, passing themselves off as something they are not? Share your thoughts with us. Please comment below, interact with us on Twitter at @fanews_online or email me - [email protected]
Comments
By the way, letsplan.co.za doesn't work any more. Report Abuse