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- Title
The Relationship Between Financial Advisor Designations and Misconduct.
- Authors
Camarda, Jeffrey; de Jong, Pieter J.; Timmerman, Inga
- Abstract
Using a unique misconduct scoring method, we explored the relationship between professional designations and public record misconduct for securities-licensed financial advisors regulated by FINRA in the state of Florida. We intend to validate the signals sent by designations' sponsors that their higher education and ethical conduct mandates are associated with better consumer outcomes, as measured by: (a) lessened complaints; (b) regulatory actions; and (c) other documented misconduct. After controlling for confounding factors of gender, life insurance sales licensure, and fiduciary/non-fiduciary dual registration, we find that the least severe measure of advisor misconduct is negatively associated with possessing any of the CFA®, ChFC®, and CFP® certifications. However, being a CFA® charterhold and having the CFP® certification lose statistical significance at the 5% level for two more egregious measures of advisor misconduct. These findings provided limited evidence regarding the negative relation between these certifications and advisor misconduct, with the strongest evidence for the ChFC® certification.
- Publication
Journal of Personal Finance, 2020, Vol 19, Issue 1, p19
- ISSN
1540-6717
- Publication type
Academic Journal